[Senate Hearing 108-760]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 108-760

                   THE 9/11 COMMISSION HUMAN CAPITAL
                      RECOMMENDATIONS: A CRITICAL
                           ELEMENT OF REFORM

=======================================================================

                                HEARING

                               before the

                  OVERSIGHT OF GOVERNMENT MANAGEMENT,
    THE FEDERAL WORKFORCE, AND THE DISTRICT OF COLUMBIA SUBCOMMITTEE

                                 of the

                              COMMITTEE ON
                          GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                               __________

                           SEPTEMBER 14, 2004

                               __________

      Printed for the use of the Committee on Governmental Affairs


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                   COMMITTEE ON GOVERNMENTAL AFFAIRS

                   SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska                  JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio            CARL LEVIN, Michigan
NORM COLEMAN, Minnesota              DANIEL K. AKAKA, Hawaii
ARLEN SPECTER, Pennsylvania          RICHARD J. DURBIN, Illinois
ROBERT F. BENNETT, Utah              THOMAS R. CARPER, Delaware
PETER G. FITZGERALD, Illinois        MARK DAYTON, Minnesota
JOHN E. SUNUNU, New Hampshire        FRANK LAUTENBERG, New Jersey
RICHARD C. SHELBY, Alabama           MARK PRYOR, Arkansas

           Michael D. Bopp, Staff Director and Chief Counsel
      Joyce A. Rechtschaffen, Minority Staff Director and Counsel
                      Amy B. Newhouse, Chief Clerk

                                 ------                                

  OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE 
                   DISTRICT OF COLUMBIA SUBCOMMITTEE

                  GEORGE V. VOINOVICH, Ohio, Chairman
TED STEVENS, Alaska                  RICHARD J. DURBIN, Illinois
NORM COLEMAN, Minnesota              DANIEL K. AKAKA, Hawaii
ROBERT F. BENNETT, Utah              THOMAS R. CARPER, Delaware
PETER G. FITZGERALD, Illinois        FRANK LAUTENBERG, New Jersey
JOHN E. SUNUNU, New Hampshire        MARK PRYOR, Arkansas

                   Andrew Richardson, Staff Director
   Marianne Clifford Upton, Minority Staff Director and Chief Counsel
                      Kevin R. Doran, Chief Clerk


                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Voinovich............................................     1
    Senator Coleman..............................................     4
    Senator Pryor................................................    15
    Senator Collins..............................................    19
Prepared statements:
    Senator Akaka................................................     4
    Senator Durbin...............................................     5

                               WITNESSES
                      Tuesday, September 14, 2004

Jamie S. Gorelick, Esq., Commissioner, National Commission on 
  Terrorist Attacks Upon the United States.......................     7
Fred Fielding, Commissioner, National Commission on Terrorist 
  Attacks Upon the United States.................................    10
Mark Steven Bullock, Assistant Director, Administrative Services 
  Division, Federal Bureau of Investigation......................    21
John Turnicky, Special Assistant to the DCI for Security, Central 
  Intelligence Agency............................................    23
J. Christopher Mihm, Managing Director of Strategic Issues, U.S. 
  Government Accountability Office...............................    25
Paul C. Light, Ph.D., Senior Fellow, The Brookings Institution...    35
C. Morgan Kinghorn, President, National Academy of Public 
  Administration.................................................    37
Doug Wagoner, Chairman, ITAA Intelligence/Security Clearances 
  Task Group.....................................................    39
Max Stier, CEO, Partnership for Public Service...................    41

                     Alphabetical List of Witnesses

Bullock, Mark Steven:
    Testimony....................................................    21
    Prepared statement...........................................    58
Fielding, Fred:
    Testimony....................................................    10
    Joint prepared statement.....................................    51
Gorelick, Jamie S., Esq.:
    Testimony....................................................     7
    Joint prepared statement.....................................    51
Kinghorn, C. Morgan:
    Testimony....................................................    35
    Prepared statement...........................................    98
Light, Paul C., Ph.D.:
    Testimony....................................................    35
    Prepared statement...........................................    88
Mihm, J. Christopher:
    Testimony....................................................    25
    Prepared statement...........................................    68
Stier, Max:
    Testimony....................................................    41
    Prepared statement...........................................   130
Turnicky, John:
    Testimony....................................................    23
    Prepared statement...........................................    63
Wagoner, Doug:
    Testimony....................................................    39
    Prepared statement with an attachment........................   106

                                APPENDIX

Responses to questions for the Record from:
    Mr. Gorelick.................................................   139
    Mr. Fielding.................................................   141
    Mr. Bullock..................................................   143
    Mr. Mihm.....................................................   159
    Mr. Kinghorn.................................................   164
    Mr. Wagoner..................................................   166

 
                   THE 9/11 COMMISSION HUMAN CAPITAL
                      RECOMMENDATIONS: A CRITICAL
                           ELEMENT OF REFORM

                              ----------                              


                      TUESDAY, SEPTEMBER 14, 2004

                                     U.S. Senate,  
            Oversight of Government Management, The Federal
              Workforce, and the District of Columbia Subcommittee,
                          of the Committee on Governmental Affairs,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 9:30 a.m., in 
room SD-342, Dirksen Senate Office Building, Hon. George V. 
Voinovich, Chairman of the Subcommittee, presiding.
    Present: Senators Voinovich, Collins, Coleman, Pryor, and 
Carper.
    Senator Voinovich. Good morning. I am confident that this 
Subcommittee will rise to the challenge before it to report 
legislation which will enhance the security of the United 
States of America. I know some say we have spent a very short 
time contemplating reforms. I would like to say that our 
Chairman has done a beautiful job of vetting this issue and 
hearing from everyone. There are more hearings scheduled which 
will allow us to move forward in implementing recommendations 
of the 9/11 Commission.
    I want to congratulate Senator Collins and Senator 
Lieberman for the work that they have done.
    I am honored that Senator Collins has asked me to Chair the 
hearing today. I am hopeful that the proposals we discuss today 
eventually will be included in the Committee's legislation.
    On March 29, 2001, this Subcommittee held a hearing 
entitled ``The National Security Implications of a Human 
Capital Crisis.'' The panel of distinguished witnesses that day 
included former Defense Secretary James Slessinger, a member of 
the U.S. Commission on National Security in the 21st Century.
    At the end of Secretary Schlesinger's testimony, he said 
this, ``As it enters the 21st Century, the United States finds 
itself on the brink of an unprecedented crisis of competence in 
government. The maintenance of American power and the world 
depends on the quality of the U.S. Government's personnel, 
civil and military, at all levels. We must take immediate 
action in the personnel area to ensure that the United States 
can meet future challenges. Fixing the personnel problem is a 
precondition for fixing virtually everything else that needs 
repair in the institutional edifice of U.S. national security 
policy.''
    When September 11 occurred, the first thing that came to my 
mind is we didn't have the right people with the right 
knowledge and skills at the right place at the right time. If 
you survey government, you will find where you have problems, 
this usually is the reason why we have those problems.
    Secretary Schlesinger's insightful comments were reinforced 
by the 9/11 Commission. On page 399 of the report, the 
Commission recommended significant changes in the organization 
of the government. The Commission went on to say: ``We know the 
quality of the people is more important than the quality of the 
wiring diagrams. Some of the saddest aspects of the 9/11 story 
are the outstanding efforts of so many individual officials 
straining, often without success, against the boundaries of the 
possible. Good people can overcome bad structures. They should 
not have to.'' They should not have to.
    The 9/11 Commission specifically noted several areas for 
Federal personnel reform, including improving the Presidential 
appointments process for national security positions and 
establishing a single agency to conduct security clearance 
background investigations. As we know, there are multiple 
agencies that investigate clearances, and it takes too long. I 
will never forget hearing from people that had transferred 
agencies and said that the new agency would not accept the 
security clearance from any other agency. This meant that they 
had to start all over again.
    A third recommendation from the Commission is to provide 
some additional personnel flexibilities to the Federal Bureau 
of Investigation to reflect its increased counterterrorism 
intelligence responsibilities. This is another thing that we 
have been working on for a long time trying to understand if 
the FBI has the personnel flexibilities to get the job done. 
For a dozen years, they have been asking for more personnel 
flexibilities and have never been responded to.
    Normally, the Subcommittee would hold individual hearings 
on each of these topics; however, the Senate's tight 
legislative schedule precludes this. So we are addressing all 
three recommendations today.
    First, the 9/11 Commission recommends streamlining the 
Presidential appointments process. This is a problem that I 
have been examining for years. When Senator Fred Thompson left 
the Senate, I told him I would continue to push for 
appointments reform. I think most of us know that once a 
President is elected, everybody throws up their hands and says, 
this appointment process is awful. Once individuals are 
confirmed, somehow it kind of takes a lower priority and just 
kind of fizzles out, and then you have a new President and they 
come in and they complain about the appointment process.
    It now takes an average of 8 months to confirm an 
appointee, up from 2 months during the Kennedy Administration. 
We can do better than this. In addition, there are now 
approximately five times the number of political appointees as 
there were in 1960. Secretary of Defense Rumsfeld has stated 
that he did not have his entire team in place on 9/11, almost 8 
months after taking office. This process must be improved.
    Second, the 9/11 Commission also recommended establishing a 
single agency to provide and maintain security clearances. The 
process for investigating, adjudicating, and maintaining 
records of security clearances is disjointed and decentralized. 
There is no doubt that this system leads to delays in hiring 
and transferring employees in sensitive national security 
positions, which in turn is damaging to our national security. 
We must find a better way of managing security clearances.
    Finally, the Commission recommended that the FBI develop a 
specialized and integrated security work force consisting of 
agents, analysts, linguists, and surveillance specialists who 
are recruited, trained, rewarded, and retained to ensure the 
development of an institutional culture imbued with a deep 
expertise, and I quote, ``imbued with a deep expertise, in 
intelligence and security.''
    There is another area that I have been examining in part 
because of my concerns with the FBI personnel system. I 
sponsored legislation last fall that required the Office of 
Personnel Management to issue a report on ways to eliminate the 
classification pay and benefit disparity within the Federal law 
enforcement community. As you may or may not know, the 
Department of Homeland Security is now trying to harmonize all 
of the law enforcement employees in their agencies. My thought 
is if you are going to do that in the Department of Homeland 
Security, we cannot ignore all of the other law enforcement 
entities outside of the Department of Homeland Security.
    The FBI is on the front lines of the war on terror. 
Counterterrorism should be the most important mission of the 
FBI, and it must have the personnel, resources, and flexibility 
to get the job done. Congress must do all it can to make this 
happen.
    Commissioners Gorelick and Fielding will discuss their 
findings in greater detail, and the other witnesses will 
comment on their recommendations. There is probably widespread 
agreement that improvements in these and many other areas 
related to personnel can be made, but this discussion in no way 
diminishes the excellent work that is being done today by 
thousands of employees in the Intelligence Community. In many 
instances, they are putting their lives on the line for our 
Nation, and we owe them our heart-felt gratitude.
    Working with Senator Collins and other Members of this 
Subcommittee, I have been drafting proposals to address these 
challenges in addition to other legislation designed to enhance 
the work force of the Intelligence Community. It is essential 
that our Intelligence Community agencies have all the tools 
necessary to recruit, hire, retain, and promote individuals 
with the right competencies.
    I look forward to today's important discussion, and since 
we have so many witnesses today, I have decided to follow the 
recommendation of the Chairman, to restrict the opening 
statements of Senators, but since I only have one other Senator 
today, I would be glad to qualify my colleague.
    Senator Coleman. Thank you, Mr. Chairman.

              OPENING STATEMENT OF SENATOR COLEMAN

    I will be very brief. We have heard a lot. This is our 
eighth hearing, and there is more to hear and we have a number 
of witnesses. So I just have two observations.
    One, despite all the criticism about how difficult it is to 
get things through our Congress, I think we ought to make some 
progress here, and it is not that we are acting in haste. These 
have been extraordinary hearings over the summer. We have 
learned a lot. So I am very confident that we will move 
forward. We have talked a lot about structure, but structure in 
itself is meaningless without people, and I think we have to 
understand the whole human capital aspect of it.
    So I am looking forward to today's hearing. I am looking 
forward to getting something done, and I am looking forward to 
America being a safer place. So thank you, Mr. Chairman.
    Senator Voinovich. Thank you, Senator Coleman. One of the 
great things about Senator Coleman is that he was a mayor for 
many years, and it seems that people who have had some 
administrative experience have a little deeper appreciation on 
how important personnel is to one's success.
    I would also like to state that Senator Akaka's statement 
will be entered into the record, and any of the other Senators 
that would like their statements entered into the record, will 
be accepted.
    [The prepared statements follow:]

                   OPENING STATEMENT OF SENATOR AKAKA

    Mr. Chairman, thank you for holding today's hearing to discuss the 
human capital issues related to reforming the Intelligence Community. 
You and I have worked together over the past 6 years to ensure that the 
Federal Government has the right people with the right skills in the 
right place at the right time. It is in this light that we hold today's 
hearing to discuss the gaps in our human capital resources identified 
by the 9/11 Commission: understaffed counterterrorism centers, the long 
delay in training employees, and problems in recruiting employees with 
the requisite skills.
    Unfortunately, the need to address these gaps is not new. 
Discussions on how to reform the Intelligence Community personnel 
system has been going on for years. Since 1989, various commissions, 
studies, think-tanks, and outside experts have called for changes to 
the Intelligence Community's personnel management systems. 
Recommendations include greater personnel flexibility, stronger 
personnel management coordination, an integrated personnel and training 
system for the Intelligence Community, common standards for 
adjudications, standardized background investigations, improved 
performance appraisal and management systems, systematic career 
planning and professional development, and promotion of a sense of 
community among the agencies. More recently, in 2001, the National 
Commission on National Security/21st Century, also known as the Hart-
Rudman Commission, called for personnel reforms including rotational 
assignments for national security personnel and programs to recruit 
skilled individuals by paying educational costs in exchange for 
government service.
    While some of these recommendations have been adopted, the 9/11 
Commission report asks for further action. It is clear that first and 
foremost, the management of human capital in the Intelligence Community 
must be improved. The Comptroller General recommends there be a Chief 
Operating Officer under the National Intelligence Director (NID) to 
handle daily agency management. Depending on where the NID is placed in 
the executive branch, I recommend we consider this proposal to ensure 
that effective human capital management, the key to any successful 
organization, is a high priority. Such an individual could also have 
responsibility over issues related to information security and 
financial management.
    Moreover, I believe that a Chief Human Capital Officers Council, 
similar to that created in 2002 which focuses almost exclusively on 
policies pertaining to competitive service Federal employees covered 
under title 5, United States Code, should be created for the 
Intelligence Community. Based on recommendations made by the National 
Academy for Public Administration in the 1989 report, ``The 
Intelligence Workforce for the 1990s: A Review of Personnel and 
Compensation Systems to Meet Current and Future Missions,'' such an 
organization would be responsible for identifying, developing, and 
sharing best practices in recruitment and retention efforts and 
coordinating legislative requests for personnel flexibilities.
    Mr. Chairman, as you know, there is already legislation pending 
before Congress to improve the recruitment and retention of Federal 
workers with critical skills. In both the 107th and 108th Congress, I, 
along with several of my colleagues on the Committee, introduced the 
Homeland Security Federal Workforce Act. Although the Senate passed the 
most recent version of our legislation, S. 589, last November, the 
House has not taken action on the measure. S. 589 would permit the 
payment of an employee's educational costs in areas of critical 
national security importance--such as foreign language, science, 
mathematics, and technology--in exchange for government service. This 
approach, along with advanced planning and skills assessments by 
Federal agencies, would allow a National Intelligence Director to hire 
employees with skills tailored to meet agencies' national security 
needs. Although the FBI and the CIA have both testified before this 
Committee that they are receiving a record number of employment 
applicants, one of our priorities is to ensure that there is a large 
and highly qualified applicant pool from which to select employees 
possessing critical language, technical, and scientific skills, 
especially those possessing a combination of these skills.
    It is also critical that national security professionals have a 
breadth of experience in the interagency process and strong knowledge 
of substantive policy issues. Both elements are crucial to ensuring 
crosscutting policy formulation and analysis. To address this need, S. 
589 creates incentivized rotational programs within the Intelligence 
Community aimed at breaking down cultural and artificial barriers to 
information sharing, building a cadre of highly knowledgeable 
professionals, and ensuring cooperation among national security 
agencies.
    Lastly, the majority of the Intelligence Community currently 
operates under a non-statutory internal appeals system for performance 
and conduct cases. Although I would not change this internal appeals 
system, as a strong supporter of employee rights and protections, I 
believe that there are certain elements that every appeals system 
should contain: notice, an opportunity to respond, employee 
representation, and a decision by an independent adjudicator. Any 
entity that oversees the Intelligence Community must ensure that these 
reasonable elements are included in an employee appeals system.
    Furthermore, as a leader on strengthening Federal whistleblower 
laws, I am concerned by the myriad of laws governing employees in the 
Intelligence Community: The Intelligence Whistleblower Protection Act, 
the Whistleblower Protection Act, the Military Whistleblower Protection 
Act, the FBI Whistleblower Protection Act, and the authority given to 
Inspectors General to investigate and report allegations of retaliation 
for whistleblowing. In light of the heightened need to encourage 
Federal employees to come forward with information vital to preserving 
our national security and protecting those who make such disclosures, 
there must be strong oversight and emphasis on investigating 
disclosures and protecting those making disclosures. As such, I 
recommend that there be a designated officer in the Office of the 
Inspector General of the National Intelligence Directorate to handle 
whistleblower reprisal complaints. Similar to the Civilian Reprisal 
Investigations Office in the Department of Defense, this office would 
serve as the key contact point for whistleblowers. The office would 
have whistleblower affairs officers who would conduct investigations, 
coordinate personnel management remedies, and provide outreach to 
Federal and non-Federal agencies involved with whistleblower affairs.
    Mr. Chairman, each of my recommendations would improve human 
capital management within the Intelligence Community, in turn, which 
would strengthen our national security. Again, I thank you for holding 
today's hearing, and I thank our witnesses for sharing their views with 
us.
                               __________

              PREPARED OPENING STATEMENT OF SENATOR DURBIN

   Thank you, Chairman Voinovich, for holding this very important 
hearing on the 9/11 Commission's recommendations regarding their 
suggested changes in the Intelligence Community's personnel structure. 
You have been a stalwart leader on human capital issues for many years, 
and I thank you for giving us the opportunity to hear from these 
excellent witnesses today.
    This hearing focuses on three main recommendations of the 9/11 
Commission, namely improving the Presidential appointments process for 
national security officials, establishing one agency to conduct 
security clearance background checks, and providing additional 
personnel flexibilities to the Federal Bureau of Investigation that 
will reflect its increased responsibilities in the areas of 
counterterrorism and other intelligence gathering.

Presidential nominations.

    I agree that we need to ensure that Presidential nominees for 
members of the administration's security team are approved by the 
Senate in a timely fashion, but I do have some reservations about how 
to go about this without diminishing the important role of the Senate 
in the confirmation process. I am concerned about putting an arbitrary 
time limit, in this case 30 days, on the Senate to hold an up or down 
vote on a nominee. This takes away power from the committee 
chairpersons and the minority party in the Senate to subject 
nominations to appropriate scrutiny.
    Also, I am concerned about why this group of nominees--as opposed 
to judicial nominees or some other subset of administration nominees--
should receive preferential treatment.
    It is useful to consider the August 30 CRS analysis of the actions 
of the Clinton and Bush administrations on the topic of Senate 
confirmation of the president's security team. That report showed that 
confirmation of this group of nominees was rarely delayed more than 30 
days. The report shows that only 14 of the 49 nominees that would have 
fallen under this category were delayed longer than 30 days.

Security clearance.

    The committee is drafting a proposal that would encompass the 9/11 
Commission's recommendation to centralize responsibility for security 
clearances in one agency, and I applaud those efforts. However, I think 
the problems that have arisen in recent months as the Department of 
Defense and the Office of Personnel Management have tried to coordinate 
their efforts needs to be carefully considered since the DOD handles 
about 80 percent of the background checks needed in this country. Talks 
between these two entitles broke down in May over OPM's concern about 
taking on too much financial risk.
    There are about 188,000 people waiting for clearance, according to 
DOD's files, and it takes about 375 days for a security clearance to 
make it through the background check and adjudication process, 
according to a recent investigation by the House Government Reform 
Committee. This is far too long and deserves further exploration as to 
the reasons.

FBI personnel reforms.

    While the FBI has already begun to overhaul itself in an effort to 
create a smarter, more flexible workforce, more could be done in terms 
of coordination among existing staff. The 9/11 commission report found, 
among many other things, that FBI analysts were often untrained and 
therefore were not used to great capacity by the agency's agents. It 
would be interesting to learn more about how the bureau will be 
improving opportunities for agents and analysts to work together.

Other legislative proposals.

    I understand the committee may be contemplating legislative reform 
regarding improving and encouraging intelligence personnel to continue 
their education by enabling Intelligence Community personnel to receive 
non-taxable student loan repayments from the agency that employs them.
    I would hope serious consideration could also be given to 
legislation I have proposed that would authorize partnerships between 
local school districts and foreign language departments to provide 
intensive development for K through 12 foreign language teachers and 
incentives for students to major in math, science, or foreign 
languages. It is well-documented that the United States Government 
needs to bring personnel with a high proficiency in less commonly 
taught languages, such as Arabic, Farsi, and Thai. The Homeland 
Security Education Act would go a long way toward preparing our 
intelligence workforce for the linguistic challenges ahead.
    Thank you and I look forward to hearing from today's witnesses.

    Senator Voinovich. I now would like to hear from our 
witnesses, and we will start with Ms. Gorelick.

TESTIMONY OF JAMIE S. GORELICK, ESQ.,\1\ COMMISSIONER, NATIONAL 
     COMMISSION ON TERRORIST ATTACKS UPON THE UNITED STATES

    Ms. Gorelick. Thank you, Mr. Chairman, for having us here 
today, and thank you, Senator Coleman for joining us as well. I 
agree with the Chairman's observation. You ran a very well-run 
city. We worked together at the time.
---------------------------------------------------------------------------
    \1\ The joint prepared statement of Ms. Gorelick and Mr. Fielding 
appears in the Appendix on page 00.
---------------------------------------------------------------------------
    Mr. Chairman, we are honored to appear before you today. We 
want to thank you and we want to thank the leadership of the 
Senate for the prompt consideration of our recommendations, and 
we want to thank you for the support that you have shown to our 
Commission.
    The Commission's findings and recommendations were strongly 
endorsed by all ten Commissioners, five Republicans and five 
Democrats. We share a unity of purpose, and we have called upon 
Congress and the administration to display the same bipartisan 
spirit as we collectively seek to make our country and all 
Americans safer.
    I would like to first address the issue of personnel reform 
and the FBI, and then my colleague, Fred Fielding, will address 
the remainder of the topics before us today.
    The FBI has been a major force and a major focus for 
intelligence reform since the 9/11 attacks. Building on the 
work of a Congressional Joint Inquiry, the Commission found 
that the FBI fell far short of the mark in adequately carrying 
out its domestic counterterrorism mission. It was the lead 
agency in investigating foreign terrorist groups but it did not 
have the capability to link the collective knowledge of 
thousands of agents in the field to national priorities. As a 
result, crucial information did not find its way up the chain 
of command to those who could act upon it.
    One of the startling examples of this was that the Acting 
Director of the FBI did not learn about the Bureau's hunt for 
two possible al Qaeda operatives in the United States or the 
Bureau's arrest of an Islamic extremist trying to learn to fly 
until after September 11, and that was too late.
    We believe that institutional change to improve the FBI's 
intelligence capabilities and to focus on the Bureau's 
counterterrorism mission is of utmost importance to the 
country's national security. We have not recommended the 
creation of a new domestic intelligence agency, a MI5 type of 
structure, because we believe that creating a domestic 
intelligence collection agency is too risky for civil 
liberties, it would take too long, it would cost too much 
money, and it would sever the highly useful link between the 
criminal and counterterrorism work of the FBI and the work that 
the FBI does with State and local law enforcement.
    We considered other structural changes, but we decided that 
the broader changes would not be necessary if our other 
recommendations were adopted. As you know, as part of our 
recommendations, we proposed a National Counterterrorism 
Center. We recommend a strong center overseeing all of the 
foreign and domestic counterterrorism work, bringing it all 
together in one place, and we also recommend creating a 
National Intelligence Director who can set and enforce 
standards for collection, processing, and reporting of 
information; but I would note that if you did not have a strong 
National Counterterrorism Center or a strong Intelligence 
Director, we might well have come out with a different set of 
recommendations with regard to the FBI.
    We are encouraged by the direction in which Director 
Mueller has taken the FBI, and that he has created some new 
structures within the Bureau to keep its role focused. He has 
made progress, but he has a long way to go. He has established 
the Office of Intelligence overseen as the top tier of FBI 
management. He has created field intelligence groups in all the 
field offices to make sure that the FBI priorities and the 
emphasis on intelligence are put into practice. Improvements in 
information technology systems, connectivity, and information-
sharing with the rest of the Intelligence Community are 
planned, but progress has been slow.
    These kinds of structural and technological changes, as 
you, Mr. Chairman, point out, only take you so far. Without the 
development of an institutional culture within the Bureau that 
appreciates that counterterrorism mission and grows strong 
intelligence officers to support it, all of the structural 
improvements that we suggest will only be half measures at 
best. They have to have the right people in place if they are 
to carry out this important mission. This means establishing an 
intelligence cadre at the FBI, a specialized integrated 
national security work force made up of agents and analysts 
with the necessary training and the necessary skills.
    We believe that Director Mueller understands the human 
resources aspect of institutional change and he understands 
that the FBI needs to recruit more broadly and that working on 
national security issues requires specialized training for both 
analysts and agents. He is currently establishing a program to 
certify agents as intelligence officers, a certification that 
will be a prerequisite for promotion to the senior ranks of the 
FBI. New training programs have been instituted for 
intelligence-related subjects. Director Mueller has also 
proposed creating an intelligence directorate to include units 
for intelligence planning and policy and for the direction of 
the analysts and linguists.
    Now, some of these changes have been slow in coming, and I 
would say to you all bear oversight and scrutiny by Congress in 
order to monitor their implementation. We think that Director 
Mueller is moving in the right direction. He has begun the 
difficult effort to shift the FBI into a new preventive 
counterterrorism posture, and we have to ensure that he 
succeeds.
    The Commission's findings in this regard have not been 
entirely reassuring. The field offices that we visited showed 
that there was slow progress. Change so far is from the top 
down, and we are concerned that without sustained support and 
dedicated resources at the highest levels, the management in 
the field offices may return to focusing on local concerns over 
the national security mission. I would say, parenthetically, 
having been at the Department of Justice, you could see this as 
you visited field offices--that there was just enormous 
pressure on them locally to address whatever the local law 
enforcement priority was. We have to make sure that the 
national security mission remains strong.
    To support the Director's reform efforts and to 
institutionalize sustained reform within the FBI that will last 
beyond Director Mueller's tenure, the Commission recommends 
that the President direct the FBI to develop this intelligence 
cadre. To ensure that this work force is focused on the 
counterterrorism mission, we need personnel reform in the areas 
of recruitment, in the areas of hiring, training, and career 
development.
    So, first, the FBI should fully implement a selection 
process that centers on the need for agents and analysts with 
backgrounds and skills appropriate for intelligence work. This 
would include knowledge well beyond the traditional law 
enforcement background of most FBI agents in the areas of 
intelligence, international relations, language technology, and 
so on.
    Second, the FBI should establish basic training for new 
agents and analysts in both the criminal justice and national 
security disciplines. These agents should begin their careers 
with meaningful assignments in both areas so that each of them 
understands both disciplines.
    Third, the FBI agents and analysts should have the 
opportunity to specialize and follow a career track in either 
criminal justice or national security. Certain advance training 
courses and assignments to other intelligence agencies should 
be prerequisites for advancements along the national security 
track.
    Fourth, all senior FBI managers should be certified 
intelligence officers. This includes those managers working on 
law enforcement cases.
    Fifth, each field office should have an official at the 
deputy level for national security matters with management 
oversight to ensure that national priorities are carried out in 
the field.
    Finally, a dedicated team approach needs to be brought to 
bear on national security intelligence operations. The FBI 
should institute the integration of analysts, agents, 
linguists, and surveillance personnel in the field as well.
    Mr. Chairman, we understand that without dedicated 
resources, these personnel reforms at the FBI cannot succeed. 
To support these reforms, the Commission also recommends that 
the FBI align its budget structure to protect the intelligence 
program, making sure that the resources are managed according 
to national priorities. Congress has a critical role to play in 
monitoring these reforms.
    The FBI has 28,000 employees, 56 field offices, 400 
satellite offices, 47 legal attache offices, and countless 
other resources. It is a massive institution and it has a 
massive job to perform.
    The Director has announced plans and programs to move the 
Bureau toward enhanced national security priority, but we 
believe he needs to have the full support and oversight of 
Congress. The President and Congress have the obligation to 
make sure that these essential reforms do not receive only 
transitory attention, but become institutionalized in the 
creation of a better, stronger FBI.
    Senator Voinovich. Thank you very much. Mr. Fielding.

     TESTIMONY OF FRED FIELDING,\1\ COMMISSIONER, NATIONAL 
     COMMISSION ON TERRORIST ATTACKS UPON THE UNITED STATES

    Mr. Fielding. Thank you, Mr. Chairman, Senator Coleman, and 
Senator Pryor. I would like to join also in a word of 
appreciation for the work this Subcommittee has done. It has 
been very rewarding to those of us on the Commission to know 
that people have grasped what we were hoping they would grasp 
and are taking the ball and running with it so expeditiously.
---------------------------------------------------------------------------
    \1\ The joint prepared statement of Ms. Gorelick and Mr. Fielding 
appears in the Appendix on page 00.
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    I would like to focus my remarks on the issue of 
transitions and improvement of transitions between 
administrations. Mr. Chairman, last year you put forward a bill 
that would streamline and improve the Presidential appointment 
process, and we commend you for that leadership and must tell 
you we studied that as part of our deliberations as well, and 
we found it to be very thoughtful and instructive and 
important. And, as a personal side and aside from the 
Commission work, having labored in the vineyards of transitions 
and seen all the problems, I must say that your Section 202 
contains an awful lot of ideas and captures a lot of the wishes 
of people that work on the transition and have to work through 
this, and we hope that this goes further.
    We see a clear convergence of the Commission's 
recommendations with your proposal in the following areas: 
First, encouraging Presidential candidates to begin choosing 
appointed officials in high-level positions for the new 
administration even before the election to expedite the 
ultimate confirmation process, to encourage and 
institutionalize them to not be afraid to show that they are 
planning, because planning is so important.
    The second thing is to reduce the number of Presidential 
appointed positions in national security agencies that would 
require Senate confirmation, which will alleviate the strain of 
the current appointment and confirmation system.
    And, third, to streamline and consolidate the procedures 
such as financial disclosure, reporting requirements to 
streamline the overall Presidential appointment process. Both 
you and we clearly find that the status quo needs change.
    We must recognize that the time of a transition is a time 
of great vulnerability for our country. I mean, as we know that 
terrorists study and look for our mistakes, this is a prime 
time to do something, because it is a period where there are 
basically people going out and people coming in, but nobody is 
in charge in certain areas unless everyone is vigilant and 
realizes the vulnerabilities this creates. The 9/11 story 
informed us of the understanding and importance of reforming 
this process.
    The 2000-2001 transition between administrations occurred 
at what we now can see was a crucial point. In the lead-up to 
9/11, the USSC Cole had been attacked less than a month before 
the Presidential election. Almost all of those involved in the 
investigations told us that they strongly suspected the hand of 
al Qaeda--and perhaps Bin Laden--were involved in that attack, 
but no action was taken to retaliate for the attack on the USSC 
Cole in the months before 9/11. Senior Clinton Administration 
officials told us that they didn't have a definite answer on 
the question of responsibility. Senior Department of Defense 
officials with the incoming administration said that by the 
time they were in place and the whole Pentagon team was in 
place, it was stale. President Bush told us that he was not 
told and did not know that the Clinton Administration had 
issued an ultimatum to Taliban.
    Now we know that Bin Laden expected the United States to 
retaliate and expected that there would be some action, but we 
can observe how in this particular case the transition process 
didn't serve well in the briefing and the handing over of 
important national security decisions from one administration 
to another. Each incoming administration crafts its own 
transition. It can ask the outgoing administration for whatever 
it likes, but the latter has no affirmative obligation. The 
Clinton Administration did make substantial efforts to brief 
its successors, but information was not transferred with the 
consistency that was necessary.
    The dispute over the 2000 election resulted, to be sure, in 
a far shorter transition period than we would have normally 
been able to enjoy, but we don't consider the problems that 
have been highlighted to be unique to that particular 
transition.
    Jamie and I both have had considerable experience in 
transition and the transition process, that it is never a 
seamless one, but the difficulties have been exacerbated by the 
growing number of political appointees and positions that 
require Senate confirmation, both within the national security 
arena and otherwise. Appointees require security clearances 
that involve background investigations, security 
questionnaires, and sometimes polygraphs. The growing number of 
political appointees involve a vast amount of manpower and a 
huge effort and a consequent increase amounts of time needed to 
complete the clearance process itself.
    The delay in the confirmation in 2001 was in some cases 
considerable, as was mentioned by the Chairman. Deputy 
Secretary Wolfowitz wasn't confirmed until March 2001. The 
Undersecretary for Defense for Policy wasn't confirmed until 
July. Basically, Secretary Rumsfeld has told us, as he told 
you, he didn't have a team in place, and he gave considerable 
credit to the expertise of the holdover appointees from the 
previous administration who helped him, but he observed that 
there was no real initiative that was possible until the new 
team was in place.
    National security policy-making is too important to be 
disrupted by transition between administrations or delay by an 
overburdened system. It is just too important. We need to make 
clear and complete communication of national security policy 
information to a new President. We need to make that a 
requirement, and the practice of confirming and obtaining 
security clearances for a new administration has to be 
streamlined as much as possible.
    Our 9/11 Commission recommended reforms in a number of 
areas to make sure that the transitions would work more 
smoothly and efficiently. First, even before the election, 
Presidential candidates should submit names of selected members 
of their transition teams to the FBI or whoever is the agency 
that is conducting the clearances so that they can obtain their 
security clearances immediately so that once the election is 
over, they are getting out there and they can commence that 
transition on the day after.
    Second, immediately after the election, the President-elect 
should submit lists to fill the vacancies of his national 
security candidates, and these people can then begin getting 
their clearances so, hopefully, by January 20, those that need 
to be in place will be in place.
    Next, we recommended a single Federal agency should be 
responsible for providing and maintaining the security 
clearances. This would ensure uniform standards. It would 
ensure efficiencies, and it would also ensure one 
questionnaire, one financial reporting requirement sheet, 
anything that can streamline it, and you have to have a single 
data base. The agency that we are proposing should be 
responsible for administering polygraph tests on behalf of the 
organizations that require them.
    The next recommendation was that during the transition 
periods and no later than January 20, the President-elect 
should submit the nominations of his entire new national 
security team up through the level of at least undersecretary 
on all cabinet departments, and the Senate should adopt, we 
would suggest, special rules that require hearings and require 
a vote within 30 days of submission of these names, at least 
for the national security positions, and that the Senate should 
not require confirmation of executive appointees below 
executive level three.
    Last, as soon as possible after election day, the outgoing 
administration should provide the President-elect with a 
classified compartmental list that catalogs specific 
operational threats around the world and to our national 
security. That list should include major military or covert 
operations that are ongoing and pending decisions on possible 
use of force. Such a document would provide notice and a 
checklist inviting the President-elect to inquire and to learn 
more, and each party has responsibility in that task.
    So, Mr. Chairman, we thank you again for the opportunity to 
testify before you. The recommendations we have discussed 
before this Subcommittee today on personnel reform at the FBI 
and reform of transition between administrations comes directly 
from our studies, and we believe they are imperative to 
ensuring that our country is safer and more secure. We should 
seize the moment. We should move forward with this reform and 
with the other reforms that we suggested, but with your counsel 
and your direction, we believe the Nation can and will make 
wise choices.
    And we would be pleased to respond to any of your questions 
at this point. Thank you.
    Senator Voinovich. Thank you very much for your testimony.
    I would like to welcome Chairman Collins to this hearing. 
Would you like to make any statements before we start to ask 
the witnesses questions?
    Chairman Collins. No, Mr. Chairman. I just want to thank 
you for all the work you have done in the area of human capital 
and thank you for chairing today's hearing.
    Senator Voinovich. Thank you.
    If Congress creates a National Intelligence Director, how 
much authority should this individual have over personnel 
matters, for example transferring people from one agency to 
another agency? Along with that, I would like to quote from the 
DHS Inspector General. He issued a report entitled ``DHS 
Challenges in Consolidating Terrorist Watch List Information.'' 
He said: ``In the report, the IG mentions the staffing problems 
associated with a terrorist screening center and a terrorist 
threat integration center.'' Specifically, the report says, 
``in the absence of a strategy and central leadership, there 
has been no effective means of coordinating among Federal 
agencies to ensure that the TTIC and the TSC obtain the 
personnel resources they need.''
    Does the 9/11 Commission have a similar view on this issue? 
Do you think that a chief human capital officer could fulfill 
an important strategic personnel role for the Intelligence 
Community? In other words, we are going to have a new Director 
and they are going to have to be evaluate the personnel in all 
these various agencies, and I would just like your reaction to 
whether or not that individual should have working for them a 
chief human capital officer, as we have mandated in other 
agencies.
    Ms. Gorelick. Mr. Chairman, I would like to make a couple 
of comments. We recommended that there be four responsibilities 
of the National Intelligence Director, and one of them is 
personnel. The reason for that is that building an intelligence 
cadre across the various intelligence agencies--which could 
cross-pollinate and they could get to know each other and they 
could have common standards--would be enormously helpful. We 
didn't address precisely about the ability to move people 
around, but the other authority that the National Intelligence 
Director would have, in our view, is budget authority, and that 
would make a National Counterterrorism Center, for example, 
much more effective than the Terrorist Threat Integration 
Center currently is or the Terrorist Screening Center, because 
it is borrowing people. It doesn't have its own resources. It 
has no centralized direction to draw upon other agencies.
    So if you combine the personnel authority and the budget 
authority that we contemplate, I think both of the issues that 
you have raised would be addressed. I, frankly, was unaware and 
we did not precisely talk about a position of the sort you 
describe, but if I were the National Intelligence Director, I 
would certainly want one, because I would want to have someone 
to turn to on all of these personnel issues across this vast 
array of agencies.
    Senator Voinovich. This Subcommittee, as part of our human 
capital reform agenda, required a chief human capital officer 
in all CFO agencies, it was interesting that when agencies 
prepared their GPRA, so many of them never talked about the 
personnel that they needed to get the job done. One of the 
first things that the new intelligence director must do is 
determine whether the Intelligence Community has the employees 
that are needed to get the job done.
    Following up on that, certain agencies have more personnel 
flexibility than others. For example, the FBI does not have the 
flexibilities that others do. Would either one of you want to 
comment on that? And I will mention they do have some 
flexibilities that have been given to them under the previous 
law and under the new law that we passed, but in addition to 
those, do you think that they ought to have more flexibility?
    Mr. Fielding. Well, Mr. Chairman, I think that it is very 
important that we understand what we are proposing, because it 
fits right into what you are saying. There has to be 
flexibility. There are a couple of things that are problems 
that we kept seeing. One of them was--I don't know how to call 
it. I guess I would say there is a need to break down 
subcultures within our Intelligence Community where everyone 
develops their own little niche and they don't talk to each 
other, as we have seen. The training has to be consistent. 
There has to be somebody who oversees and understands what 
training there are across the Intelligence Community.
    For instance, language proficiency is a horribly 
embarrassing situation for us right now. We just don't have it.
    Senator Voinovich. I hate to interrupt you, but one of the 
things that really drove me right up the wall after 9/11 was we 
put out a clarion call, can anybody speak Arabic and Farsi. I 
could not believe that our government was not in a position 
after we had fought Desert Storm to have those people on board.
    Mr. Fielding. That is exactly what I am suggesting, and if 
you have a limited number of people, there has to be some way 
to make sure that they are at the right place at the right 
time, and there has to be a development of training and 
recruitment that is consistent so that--this is not going to be 
an easy task to get the people that we need. The problem that 
we have, candidly, with TTIC, for instance, right now is that, 
as Jamie says, they are coming from different agencies, but all 
they are doing is filling slots. That doesn't mean that the 
person coming from that agency has the expertise that is 
needed. Somebody has to figure out what is needed across our 
Intelligence Community, and this is a personnel issue.
    Ms. Gorelick. If I might just add very quickly in response 
to your comment, Mr. Chairman, about the hiring of linguists 
and others, it is important to understand that the FBI for 
decades had as its model of who to hire an experienced cop. It 
would try to hire the best local law enforcement people it 
could find, but it did not have a model for an analyst. It did 
not have a model for a linguist. It did not have in its hiring 
criteria or its flexibilities an effort to bring in that type 
of person.
    So even when there was this outpouring of support and 
people coming forward with language skills, the Bureau was not 
able to digest and accept many of the people who volunteered 
because of the requirements that it had on the books.
    Senator Voinovich. Thank you.
    Just one last issue: The security clearance process. Do you 
think with the different cultures of all these agencies, that 
we will ever be able to get one agency to assume the process?
    Mr. Fielding. I think that agencies are sometimes 
responsive to congressional directives.
    Ms. Gorelick. This is an imperative. I have had clearances 
from the DOD, the Department of Energy, the CIA, and the 
Justice Department, and all of them started afresh, and that is 
frankly ridiculous. I think that is a common experience. It 
makes us inflexible, because it is harder to move people 
around. It takes a horrificly long time to get clearances. We 
impose tremendous burdens on people.
    One of the suggestions that was made to the Commission was 
that the Federal Government be more welcoming to people from 
the private sector who might come in for a period of time and 
go back out. If you impose transaction costs that are so high 
on people coming in and out, they are just not going to do it. 
Once you get in, you are just never going to go back out again, 
or it is too high a burden to come in in the first place, and 
that is a tragic loss.
    Mr. Fielding. Yes. That is really the problem with the 
whole security clearance and the whole clearance process--we 
make it so difficult for people to come into government, that 
the very laws that are supposed to carry out the will of the 
people become the very instruments to inhibit the people from 
having their very best come in. And I hate to paraphrase, 
badly, Plato, but, ``the penalty of wise men who decline to 
participate in their government is to be ruled by unwise men,'' 
and we must not let that happen.
    Senator Voinovich. Thank you. Chairman Collins.
    Chairman Collins. I will defer to Senator Pryor.

               OPENING STATEMENT OF SENATOR PRYOR

    Senator Pryor. Thank you. Let me follow up with what you 
are saying there. So as I understand your recommendation, right 
now we have about seven or so departments that are doing these 
security clearances, but your recommendation is to centralize 
that and put it into one office. I think there are some here on 
the Subcommittee and in the Senate that would like to see that 
responsibility be put under the National Intelligence Director. 
Would that be agreeable to you all? Is that consistent with 
your recommendation?
    Mr. Fielding. The recommendation, it is more important to 
us that it is in one place, whether it is directly in the NID's 
control or whether it is a designated agency. The key is to 
have uniformity in the process and also consistency in the 
process and consistency in the clearing goals, the timing 
goals.
    Senator Pryor. Some of this right now, as I understand it, 
has been contracted out to the private sector. Does that 
concern you that some of these functions are contracted out?
    Ms. Gorelick. Well, all of us, I think, have had contact 
with individuals who are in the contracting community who 
perform these services, and many of the services could easily 
be contracted out because they are simply verifying very 
mundane facts.
    Senator Pryor. Just mundane facts?
    Ms. Gorelick. Mundane facts. At the level of judgment, you 
would want to have issues determined by government personnel, 
but we didn't discuss this as a Commission, so in answering 
your question, we are drawing on our own experience, but I 
don't personally have an objection to having some of the 
services provided external to the Federal employee base.
    Mr. Fielding. No. I wouldn't object to that as long as you 
had the consistency and standardization.
    Senator Pryor. I think that is the key, yes.
    Mr. Fielding. That is the key.
    Senator Pryor. Yes. Because if you do contract out, you may 
lose consistency. You may get different quality of product 
back. Do you agree with that? We are giving very serious 
thought to the Commission's recommendations and we are just 
trying to work our way through some of these.
    Let me move onto a different subject, and that is the 9/11 
Commission has recommended that we remove the executive level 
three appointees from Senate confirmation. What led the 
Commission to draw the line at that level? Give us some insight 
on how you arrived at that conclusion.
    Ms. Gorelick. Well, we just looked at the numbers, really, 
and decided that if you were going to try to have the national 
security team in place, and I would note that our 
recommendations are only for the national security team, and 
you wanted to have everyone in place 30 days of the 
inauguration, we just looked at what we thought the Senate's 
system for confirmation could handle and drew the line that 
way. There is no magic to it. What we were trying to do is put 
our government in a position where no later than 30 days after 
inauguration, there would be an up-and-running functioning 
government.
    Mr. Fielding. And, Senator, if I may add to that just a 
bit, as Jamie said, there is no magic to this. We were trying 
to become efficient, especially in the national security 
positions, so that we don't have this very dangerous hiatus 
that we made reference to earlier.
    The other thing that you have to acknowledge is that it 
also imposes the requirement on the integrity of the Executive 
Branch. When they are appointing people, if there is a problem 
that develops within their FBI clearance, for instance, they 
must deal with it responsibly if you would do away with the 
confirmation hearing, because part of the process of the 
confirmation is to deal with that sort of issue.
    Senator Pryor. Let me ask, if I can, on this confirmation 
issue and the dangerous hiatus that you referred to when one 
administration passes the baton to other administration, did 
you all get into when there is a party change, if it is worse 
during the time of a party change, or is it just inherent in 
changing administrations that you might fumble that baton?
    Ms. Gorelick. It is worse when the transaction is between 
parties, as you can imagine.
    Senator Pryor. That is what I would assume.
    Ms. Gorelick. Intra-party, there have been issues. I mean, 
between the Reagan and Bush Administrations, it wasn't 
completely smooth, for example, and Fred can speak to that, but 
it is a bigger problem between parties because basically the 
government empties out. You have one holdover in each 
department, but the White House is vacant. You come in the 
first day, and there is nothing, and that is an actually fairly 
scary scenario that we both have seen since we have probably, 
between the two of us, done more vetting for our respective 
parties than maybe anybody else, and we have worked, both of 
us, on transitions. To arrive in an office with nothing there 
is not a comforting picture.
    Mr. Fielding. Clearly, to confirm your suspicions, it is 
much more difficult when there is a change in party just 
because ordinarily you have more than one person staying over, 
holding over or even desiring to hold over if it is the same 
party, but there is none. And what Jamie says, people don't 
seem to realize when you go into a White House, for instance, 
and the policy shop of other departments as well, you open the 
file drawers and they are empty, and there is no little book 
left behind saying this is it. So it, again, requires the 
integrity of both parties to this thing to make sure that 
everybody hands off and understands what is going on.
    Senator Pryor. Thank you, Mr. Chairman.
    Senator Voinovich. Thank you. Senator Coleman.
    Senator Coleman. Thank you, Mr. Chairman. It is interesting 
to note that all the folks at the table here have been involved 
in running operations at a local level, State level. I was 
involved in a transition as a mayor. I walked in and there was 
nothing in the file, nothing there, and obviously we can't 
afford to do that.
    I would note with interest and I would suspect that the 
transition recommendations are relevant even if there is a 
continuation of an administration. In other words, folks move 
on. There is a lot of discussion today of who is in, who is 
out. I would suspect that the timeliness of these things, the 
streamlining of process, are just as relevant. It may not be as 
much a conflict, but just as relevant in the transition of one 
administration into a second term.
    Ms. Gorelick. You are unlikely to have everyone at the 
State Department walking out the door at the same time. The 
President would be in a position, presumably, to ask his 
appointees to stay until their successors are in place.
    Senator Coleman. I am just looking at our end in terms of 
speeding up clearances and some of the things that we would 
need to do just to make it easier to move in so folks can keep 
moving at the same pace.
    Mr. Fielding. Well, actually, some of the things that are 
proposed, especially the pending bill, are needed regardless of 
transitions. It is needed for the efficiency of government, for 
getting people in. Again, as I said, we must be sure we are 
getting people in and not making the price of entry so 
prohibitive that they don't want to come into public service.
    Senator Coleman. I would also compliment you for your 
boldness in the recommendation to encourage candidates to begin 
choosing appointed officials in high-level positions before the 
election. I presume you have got one candidate out there 
looking--what is the message today. You have another candidate 
trying to get control of the message, and no matter what we do, 
it is very political. So if you put forth the name of anyone 
and that gets out, that runs the risk of getting off the 
message of creating an issue.
    Prospects of realistically getting that done, how would you 
rate that?
    Mr. Fielding. As I said earlier, I think that the big 
problem is, from my experience, a candidate doesn't want to 
acknowledge that he or she is so sure that they are going to 
win that they are picking their cabinet, and so you have to 
force them to do it, because if it is publicly known that they 
are forced to do something, then it is easy for them to do what 
they would otherwise logically do.
    Ms. Gorelick. We would like to make it be, and appear to 
be, irresponsible not to begin thinking about the next steps 
even when the election is pending and, at the very least, to 
identify those who would be responsible for a transition.
    Senator Coleman. If there was a way that you could assure 
that would not get caught up in the political debate, that 
would be helpful. I am not sure how that is done. Again, I 
support the recommendation, but the reality is you put forth 
any name in any position and it becomes a subject of discussion 
at a time when you want to discuss something else, perhaps, so 
a great challenge.
    One of the issues that has come up in the course of these 
hearings has been the question of accountability. A number of 
my colleagues have said we have read the 9/11 Commission 
Report; there were some things that were not done; there was 
follow-through that didn't happen. And yet there is the 
question of accountability. We are talking about making change 
and changing systems here, but do we need to have kind of a 
public accounting of who is responsible, who messed up before 
we go forward? That issue still hangs out there and I am just 
not sure it has been resolved.
    Ms. Gorelick. We talked about this. We decided that for 
purposes and our charter, the best thing we could do is lay out 
all the facts. If we, ourselves, tried to decide who should 
remain in government and who should lose their jobs, it would 
be a morass from which we might not ever re-emerge, and it 
would detract from our efforts to do the things that we thought 
were more important. But if I were running any one of the 
executive agencies whose conduct is the subject of our very 
detailed findings, I would review them and determine whether 
there should be accountability on the part of anyone who 
continues to work for me. I just think that is basic 
management, and that material is there for everyone to see.
    Senator Coleman. Looking at the changes, one of the 
concerns with regard to the FBI, the Commission noted the 
concern about the sustainability of the change. Right now, it 
appears Director Mueller is moving in the right direction, 
right attitude, right approach, but there is concern about the 
long-term sustainability, and the issue then comes about all 
this bears oversight.
    Do you have any suggestions about how we do a better job on 
oversight? I think we are moving forward on a lot of these 
recommendations, but the one area that is probably going to 
take a little more time is on our end. With all that we have to 
do and the demands on time, can you just talk a little bit 
about the type of oversight that you would like to see? What 
should we be doing that we are not doing now?
    Mr. Fielding. Our experience with the intelligence 
oversight in particular was that everyone, when the door was 
closed and the cameras were off, acknowledged to us that the 
system was inefficient and was ineffective. We made what were 
considered to be bold recommendations, in all due respect, to 
how Congress should reform itself, and maybe they were bold and 
maybe they were unattainable, people would tell us, but given 
the background and given the subject matter that we were 
discussing, if we couldn't make such bold recommendations out 
of September 11, when would we ever make such bold 
recommendations?
    So just to wrap up, there is a need to reform. There is a 
need to take the politics out of oversight, and we hope that 
you will study it and come up with a solution.
    Ms. Gorelick. If I might add to Fred's comments, one of the 
reasons that we were so prescriptive in our suggestions and 
recommendations with regard to the FBI is that we were quite 
conflicted given the performance we saw there. We concluded if 
the FBI moves in these very clear directions and there is 
pressure from Congress to do so, then it can get where it needs 
to go. We have outlined what we think oversight of the FBI and 
its progress should look like in the near-term; we were very 
specific. In general, our observation with regard to 
congressional oversight is that oversight committees should ask 
of each agency, ``What is your biggest challenge?'' ``What is 
your strategy to meet that challenge?'' and ``What are the 
obstacles to your achieving that strategy?'' What happens too 
often is that members and staff try to mimic what the Executive 
Branch is doing and try to oversee particular programs and 
activities. At the same time, no one is looking more 
strategically at the overarching obstacles.
    I would suggest that you look at the larger picture, force 
the agencies to tell you what their strategies are and hold 
them to it.
    Mr. Fielding. If I could just add one more thought to that, 
the problem too often is that oversight means ``come tell us 
when you did something wrong,'' and I think oversight has to be 
more than that.
    Senator Coleman. Thank you. Thank you, Mr. Chairman.
    Senator Voinovich. Madam Chairman.

             OPENING STATEMENT OF CHAIRMAN COLLINS

    Chairman Collins. Thank you, Mr. Chairman. Let me begin 
again by commending you for all the work that you have done on 
human capital. There is no one in the U.S. Senate who 
understands better than Senator Voinovich that the people are 
the key.
    I was struck in the 9/11 Commission's Report by many 
phrases, but one that stuck in my mind was the phrase ``good 
people can overcome bad structures; they should not have to.'' 
I am hoping that the work that this Subcommittee and others 
have done in the past 6 weeks will produce the kind of good 
structure that enhances the ability of good people, and I want 
to thank both of you for all of your efforts and all of your 
contributions to the Commission's work. It really is critical. 
I think there is nothing that is more important that we will do 
before we adjourn than the reform of our Intelligence 
Community, and I really appreciate your being here today.
    Earlier this year, I visited what is known as TTIC, the 
Terrorist Threat Integration Center. In many ways, the National 
Counterterrorism Center is a beefed up, more robust version of 
TTIC. I was struck when I visited TTIC by the fact that with 
the exception of the director and a few of his deputies, 
everyone else that I saw, everyone else who briefed me, was so 
young, and what had occurred to me that what the agencies that 
were supporting TTIC were doing is they were sending very 
bright eager-beaver young people, but people who had very 
little experience, and as we know, it takes a great deal of 
experience to develop the judgment, the intuition, and the 
ability to be effective.
    So one of my concerns is making sure that the NCTC gets the 
best people. How will we bring that about? Should we give the 
director of the center direct personnel authority he does not 
have right now? At present, John Brennan has to rely on the 
goodwill of the CIA and the FBI and all the agencies that 
support him. If I were the CIA director, why would I want to 
send my best people over to this agency? I need them.
    So how will we ensure that the National Counterterrorism 
Center has the high quality analysts? I don't mean to in any 
way disparage of the ability of the people now working at TTIC, 
but how can we assure that we get the kind of experienced 
analysts that is necessary, in my view, to really bring the 
center to that next level?
    Ms. Gorelick. Senator Collins, your having visited TTIC and 
looked at this ensures that you have the same perspective on 
TTIC that we did. We came to the same conclusion. It is not 
what it needs to be. You can ensure that it will be what it 
needs to be when it is the National Counterterrorism Center, 
first, by making sure the person who runs it is of a very 
senior level. We recommend that it is headed by someone at the 
deputy secretary level person, not someone buried in the 
bureaucracy. Second, it has to have its own dedicated 
personnel, and you can ensure that it gets the best personnel 
because if, as we recommend, the National Counterterrorism 
Center reports directly to the National Intelligence Director 
and he or she has budget authority. That is a pretty good lever 
for getting the very best people.
    Third, one of our observations was that there are too many 
different fusions centers all over town. So if you are in the 
Defense Department, you are building a fusion center and 
bringing in people from everywhere else, and the same is true 
at the State Department, at the FBI, the CIA, the NSA, and it 
is a bewildering alphabet soup of fusion centers. Well, 
everyone who wants those personnel wants the very best, and 
everyone who has the personnel doesn't want to give the very 
best to a different agency's center. If you can eliminate the 
other fusion centers, you could save those precious experienced 
analysts for the National Counterterrorism Center.
    Chairman Collins. Mr. Fielding.
    Mr. Fielding. And there again, just by giving the authority 
to one person and having uniform procedures set up and uniform 
policies, you enhance the chances that you are going to get the 
people. As I said earlier, unfortunately, and I don't mean to 
disparage anybody that is at TTIC now either, but some of them 
are brought there simply to get the numbers in, and as somebody 
observed, you are not going to send your best person if you can 
keep them by your side. You are going to send somebody else.
    The other thing that may help this is if the National 
Intelligence Director also has the authority to establish 
across the Intelligence Community a single senior intelligence 
service so that this is a career and these people can move 
where they are needed, if you will, across the government. And 
I think that would make some sense too.
    Chairman Collins. Thank you.
    Senator Voinovich. Thank you very much. We could have you 
stay here for another half hour, but we have two other panels. 
We really appreciate your being here today, and I was really 
impressed with your testimony. Thank you very much for the 
great service you have given your country, the hours and hours 
that you have spent. Thank God we have people like you.
    Ms. Gorelick. Thank you, Mr. Chairman.
    Mr. Fielding. Thank you, and thank you for your support.
    Senator Voinovich. The second panel will come forward, and 
it consists of Mark Bullock. He is the Assistant Director of 
Administrative Services Division at the Federal Bureau of 
Investigation.
    Mr. Bullock, I understand that you were in my home town.
    Mr. Bullock. Yes, I was.
    Senator Voinovich. He took over after Van Harp, and I 
thought to myself isn't it wonderful that we have somebody that 
is in administrative services that has actually had some real 
work experience.
    Mr. Bullock. Absolutely.
    Senator Voinovich. Our other witnesses are John Turnicky, a 
Special Assistant to the Director of the Central Intelligence 
Agency for Security, and Christopher Mihm, the Managing 
Director of Strategic Issues for the Government Accountability 
Office, who I have worked with for the last 5\1/2\ years, since 
I came to the Senate.
    Mr. Mihm. Yes, sir. It has been an honor.
    Senator Voinovich. Thank you for all of your efforts and 
the great help that GAO has given me in this Subcommittee.
    Mr. Mihm. Thank you, sir.
    Senator Voinovich. Thank you for being here, and we will 
begin testimony with Mr. Bullock. I would ask you to keep your 
statements to 5 minutes. We will continue with 6-minute rounds 
of questioning for the Members of the Subcommittee.
    Mr. Bullock, thank you.

   TESTIMONY OF MARK STEVEN BULLOCK,\1\ ASSISTANT DIRECTOR, 
      ADMINISTRATIVE SERVICES DIVISION, FEDERAL BUREAU OF 
                         INVESTIGATION

    Mr. Bullock. Thank you, Mr. Chairman. It is a pleasure to 
be here, and thank you to, although Madam Chairman has 
departed, to the other Senators for having me.
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    \1\ The prepared statement of Mr. Bullock appears in the Appendix 
on page 00.
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    Again, as you stated, I am Mark Bullock. I am Assistant 
Director for Administrative Services with the FBI.
    And, also, I am the Human Capital Officer for the FBI. I am 
responsible for recruiting and hiring.
    Senator Voinovich. Pardon me. You are the Chief Human 
Capital Officer at the FBI?
    Mr. Bullock. Yes.
    Senator Voinovich. OK.
    Mr. Bullock. I am responsible for recruiting, hiring, 
personnel policy administration, our career development 
program, and our background investigations, be they FBI 
employees or executive appointments from the White House. 
Again, I am pleased to have the opportunity to address this 
body.
    The terrorist attacks of September 11 have brought about 
profound changes in the FBI, not only in terms of realigning 
our priorities and resources to prevent another terrorist 
attack, but also in transforming our work force to carry out 
our intelligence and investigative missions both in the near 
term and in the future. The FBI success in preventing 
terrorists acts and preventing U.S. National security is 
intrinsically linked to our success in elevating and 
integrating the role of intelligence in our operational 
programs.
    As stated by Jamie Gorelick, I will extract some of the 
words from the primary 9/11 human capital recommendation 
affecting the FBI. Basically, we have to establish a 
specialized and integrated national security work force, 
consisting of agents, analysts, linguists, and surveillance 
specialists who are recruited, trained, and rewarded and 
retained to ensure the development of an institutional culture 
with a deep expertise in intelligence and national security.
    The Commission's recommendations and implementing actions 
are fully consistent with the intelligence directorate, the 
intelligence career service, and newly-formed career tracks of 
special agents that were announced by Director Mueller in April 
2004. These changes reflect the vision and direction that he 
has set for the FBI in its recently revised FBI strategic plan 
covering the next 5 years and the Bureau's first ever human 
capital plan. Additionally, these changes begin to implement 
the guiding principles that are set out in the FBI's human 
talent for intelligence, production, and concept of operations.
    Underlying the changes in career tracks announced by 
Director Mueller is the concept of an integrated intelligence 
career service within the FBI that is fully compatible with the 
Bureau's investigative mission. From a human capital 
standpoint, there are three critical elements to building that 
capacity: Formal career tracks, including intelligence for 
special agents; formal career tracks for intelligence analysts, 
linguist, and surveillance specialists; and the intelligence 
officer certification program. I would like to briefly describe 
some of the elements of these programs.
    For the agent career track, we will have four core tracks. 
What we envision is four core tracks: Counterterrorism, 
counterintelligence track, an intelligence track, cyber and 
criminal track. A candidate would be selected for new agents 
training. They would go to Quantico, and upon graduating 
Quantico, they would go to one of our small- to medium-sized 
offices, which are 41 offices out of our 56 field divisions, 
and they would serve in those fields divisions for 
approximately 3 years. They would receive various assignments, 
becoming a generalist for those 3 years. Then they would be 
transferred to one of our top 15 offices, where they would be 
assigned in compliance with their core track designator, be it 
intelligence, counter-intelligence, cyber, and so forth. They 
would begin the specialization process. They would receive 
advanced training and more complex assignments.
    For all agents, the new agent training curriculum has been 
modified to integrate core intelligence objectives, and that is 
at this point now down at Quantico.
    Our analyst track would be very similar to the agent track. 
We would bring people in, in a centralized fashion, meaning 
that you would compete on a national basis. They would be 
selected based upon the skills as deemed needed by program 
managers. They would go through an interview and assessment 
process and then the background investigation. Upon being 
selected, they would go to the College of Analytical Studies 
for their basic training. I would like to add that at the 
College of Analytical Studies, the curriculum was just revised 
and started with these revised processes this week. After 
completing the College of Analytical Studies, they would be 
assigned to a headquarters or field office in a system 
fashioned to the agents. They would be assigned to one of the 
four core tracks, just like the agents, and they would have 
their assignments in line with all-source analyst, a reports 
officer, or an operations specialist, the all-source analyst 
being more of a strategic analyst, the reports officer 
preparing the reports, and the operations specialist being an 
analyst that is more technical in nature, working on particular 
cases.
    The Office of Intelligence would establish the standards 
and criteria for professional development opportunities for our 
analysts. The analyst's career development would include 
rotations among field offices, headquarters, and our legate 
offices, and analysts would have to be provided with the proper 
work environment. We have to staff our offices so our analysts 
and agents can have the access to the classified materials that 
they would need. They would have to be provided with the 
appropriate analytical tools to successfully do their job; and 
assignments within the Office of Intelligence, agents and 
analysts at some point would have to become interchangeable. 
Eventually, that would extend to management and supervisory 
positions as well.
    We envision the special agent career track in intelligence 
and the intelligence analyst career tracks intersecting at the 
intelligence officer certification program. The FBI 
intelligence officer certification program would be a set of 
formal requirements satisfied through a combination of advanced 
education and specific intelligence-related disciplines or 
problem set. The completion of progressively changing and 
complex assignments in all three of the analytical work areas 
that I mentioned previously.
    The FBI currently is the only Intelligence Community 
partner that does not have an intelligence officer 
certification process. We feel in developing this process, 
which we will have developed by January 2005, that would make 
the FBI more attractive for members of the Intelligence 
Community to be detailed to the FBI. It will make our 
intelligence officers more attractive to be received as 
detailees in other Intelligence Community organizations.
    That completes my opening statement, and I will be happy to 
answer any questions that you may have, sir.
    Senator Voinovich. Thank you very much. Mr. Turnicky.

TESTIMONY OF JOHN TURNICKY,\1\ SPECIAL ASSISTANT TO THE DCI FOR 
             SECURITY, CENTRAL INTELLIGENCE AGENCY

    Mr. Turnicky. Good morning, Mr. Chairman and distinguished 
Members of the Subcommittee. I am dual-hatted in my current 
position, one as the Special Assistant to the DCI for Security, 
which is the Intelligence Community role, and secondarily, I am 
the Director of Security for the CIA, which is the internal CIA 
role.
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    \1\ The prepared statement of Mr. Turnicky appears in the Appendix 
on page 00.
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    In my role as the Special Assistant to the Director of 
Central Intelligence for Security, I would like to share with 
you ongoing initiatives that have already improved security 
processes in the Intelligence Community. The war on terrorism 
has underscored the need for the Intelligence Community to 
facilitate the sharing of intelligence information while 
protecting sources and methods. The Intelligence Community's 
security professionals play a pivotal role in monitoring the 
impact of security actions on intelligence operations and 
analysis. We believe the Intelligence Community had made 
significant strides in standardizing policies and procedures 
that provide a much stronger foundation than that which existed 
prior to September 11, 2001.
    In March 2002, the Director of Central Intelligence 
envisioned the need to centralize the management and oversight 
of Intelligence Community security policies and procedures, and 
he endorsed the formation of a Director of Central Intelligence 
Special Security Center, the DSSC. The center is pursuing 
initiatives to produce more effective and efficient security 
practices within the Intelligence Community. The center is 
working to ensure that existing common security investigative 
and adjudicative practices are consistently implemented. As 
facilitated by the DSSC, the Intelligence Community security 
directors have collaborated on strategies to improve and 
strengthen common security policies and practices, using the 
common guidelines for background investigations and 
adjudications, specifically the Director of Central 
Intelligence directives, executive orders, and national 
security directives. The Intelligence Community security 
directors strive to meet the requirements for consistent 
security processing while reducing redundant processes and 
remaining flexible enough for unique requirements.
    Some ongoing actions include performing policy review to 
promote standardization and reciprocity within the Intelligence 
Community, conducting oversight on the implementation of 
security policies, standardizing personnel security training to 
foster uniformity throughout the clearance process, and 
improving interagency reciprocity and security clearances to 
reduce adjudicative processing redundancies across the 
Intelligence Community. In addition to the ongoing actions 
outlined above, a central security clearance data base 
repository is in operation at over 100 facilities worldwide and 
will become the single source for the Intelligence Community's 
security professionals as the clearance and validation data 
base. The repository may also support a number of information-
sharing activities within the Intelligence Community, including 
intelligence dissemination, expedited personnel security 
clearance processing, and our common badge initiative.
    In response to the Subcommittee's request for views on its 
propose legislation to create a centralized investigative 
service under a national intelligence director, it is premature 
at this point to provide an official position on legislation 
until the President presents his proposed intelligence reform 
legislation which will address many of these issues. The 
President has already issued an executive order to strengthen 
the management of the Intelligence Community, which includes 
the direction to the DCI in its role as the leader of the 
Intelligence Community to establish common security access 
standards for managing and handling intelligence systems, 
information, and products. The President agrees with the 9/11 
Commission's recommendations for improving information sharing 
while protecting national security information.
    The Intelligence Community's security directors believe 
that changes implemented by the security community since 
September 11, 2001 have significantly improved the use of 
common standards and practices. We will continue to work 
together to streamline and improve the security process.
    In closing, I thank the Subcommittee for providing the 
Intelligence Community the opportunity to testify on this 
important issue, and I will be happy to address any questions 
as we go on. Thank you.
    Senator Voinovich. Thank you very much. Mr. Mihm.

   TESTIMONY OF J. CHRISTOPHER MIHM,\1\ MANAGING DIRECTOR OF 
    STRATEGIC ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Mihm. Chairman Voinovich, Senator Coleman, and Senator 
Pryor, it is always an enormous honor to appear before you and 
today in particular to talk about how strategic human capital 
management can help drive some of the transformational 
challenges that the Intelligence Community faces. As you noted 
in your opening statement, Mr. Chairman, this Subcommittee, and 
more generally the Senate Governmental Affairs Committee, has 
had a longstanding interest and concern, certainly predating 
September 11, in human capital issues and intelligence and 
homeland security concerns.
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    \1\ The prepared statement of Mr. Mihm appears in the Appendix on 
page 00.
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    As a result of the recommendations of the 9/11 Commission, 
related legislative proposals, and of course the 
administration's executive orders and plans, Congress and other 
decisionmakers confront a series of very difficult technical 
and policy questions related to intelligence in homeland 
security; however, as the work of the 9/11 Commission clearly 
demonstrated, at the center of these questions is the need to 
fundamentally change the culture of Intelligence Community. As 
the 9/11 Commission noted, the hard and the important work at 
issue is not the wiring of the agencies, but the cultures 
within individual agencies.
    Thus, my major point today is that experience has 
repeatedly shown that in organizations where people are the 
most important asset, and which is clearly the case with 
intelligence agencies, people or human capital strategies must 
be at the center of any serious change management initiative, 
and that, of course, was exactly the point that Senator Collins 
was making.
    My written statement extensively details our work on the 
FBI's human capital efforts and issues Congress needs to 
consider, in our view, in creating a single organization to 
handle personnel background investigations. In the interest of 
time, I am going to touch on four key human capital strategies 
that our work suggests to be critical in more broadly 
transforming governance, including intelligence and homeland 
security.
    First, key mergers and transformation practices can be used 
to help guide Intelligence Community reforms. Working with 
experienced leaders in the public and private sectors, 
including those that have experience in intelligence and 
defense-related issues, we identified a set of practices, 
lessons learned, and key implementation steps that successful 
mergers, transformations, and large scale change management 
initiatives go through in order to be successful. It is our 
belief that this work can also be helpful as we consider 
changes to the Intelligence Community.
    Second, and this relates, Mr. Chairman, directly to your 
question about a chief human capital officer for the NID, 
experience also shows that successful change management 
initiatives in large public and private organizations often 
take years to accomplish. I have had the opportunity to hear 
you speak of your experience in Ohio as governor about how it 
takes a lot of time to turn around an organization that has 
been in trouble. The appointment of agency chief operating 
officers is one mechanism that we think should be considered to 
obtain the sustained and inspired attention to make the needed 
changes. In addition to individual agencies chief operating 
officers, Congress may also want to consider having the 
National Intelligence Director appoint a chief operating 
officer.
    In other words, there are a range of important management 
and transformation issues, including not only those dealing 
with human capital, that warrant high level and sustained 
attention. This executive could serve under term appointment, 
to institutionalize accountability over extended periods and 
help ensure that the long-term change management and 
organizationally change initiatives are successfully 
implemented.
    A major theme of Mr. Fielding's comments earlier this 
morning was the fact that we have greater vulnerability during 
periods of transition. In our view, a chief operating officer 
under a term appointment could be one, but only one, of the 
vehicles that Congress could consider in order to maintain this 
continuity.
    Third, one of the major challenges facing the Intelligence 
Community is moving from the culture of the need to know to 
need to share. An effective performance management system is a 
vital tool to aligning the organization with desired results 
and creating what we have often called a line of sight, that is 
showing how individual, team, unit, and organizational results 
are all aligned with one another, showing individuals how what 
they do on a day-to-day basis contributes to larger results 
outside the organization. The performance management system can 
send unmistakable messages about behavior the organization 
values and the relationship of that behavior to achieving 
results. We have also found in looking at the performance 
management systems around the world that these systems can be 
effective tools in maintaining clarity and continuity during 
periods of political transition.
    Fourth and finally, Congress has authorized significant 
changes in the last 3 years, often under the leadership of this 
Subcommittee, regarding how the Federal work force is managed. 
As Congress considers reforms to the Intelligence Community's 
human capital policies and practices, in our view, it should 
also consider whether those agencies have the necessary 
institutional infrastructures in order to effectively implement 
those changes. Do they have a strategic plan in place? Do they 
have a human capital plan that is aligned with that strategic 
plan? Do they have the capabilities to effectively use those 
flexibilities?
    In summary, over the last past several years, we in GAO 
have conducted, often at the request of this Subcommittee, 
extensive work on government transformation and critical 
management issues that we believe could be helpful to the 
Intelligence Community as it considers its reforms. We would be 
more than happy to share that information with them and to 
continue to assist Congress in its oversight responsibilities.
    Thank you. I would obviously be happy to take any questions 
you may have.
    Senator Voinovich. I want to thank all of the witnesses for 
their testimony.
    Mr. Mihm, some agencies, like the CIA, operate outside of 
Title 5, while others, like the FBI, still work within the 
confines of Title 5. If we create a National Intelligence 
Director, which I am sure we are going to do, how much 
authority should that individual have over personnel matters? 
It gets back to the question I asked the first panel regarding 
transferring people and making sure they have that strategy 
that you were just talking about. Do we have the right people 
to get the job done?
    Mr. Mihm. There are a couple of issues, sir. One, as you 
were mentioning, is the different levels of authorities that 
agencies within the Intelligence Community already enjoy. It 
creates an unlevel playing field. Mark was talking about that 
in his statement.
    The second issue, though, and here we think that the model 
that Congress used for the Department of Homeland Security 
could be a good one. That is, provide the National Intelligence 
Director the authority and the responsibility to create a 
personnel system, Congress should not feel burdened or 
responsible with legislating specifically what an integrated 
personnel system would look like for the Intelligence 
Community; rather, Congress should place that responsibility 
with the NID, as you did with Department of Homeland Security, 
with the Secretary of Homeland Security and the Director of OPM 
to come up with that system and then issue regulations and work 
with the employees as appropriate to define that system.
    Senator Voinovich. Would you allow them to have the power 
to move people, if he thought they were needed, from one agency 
to another?
    Mr. Mihm. We haven't done extensive work on that, but it 
seems that certainly that is the model that Congress has used 
and agencies have used in other instances, and it has proven 
itself very successful. Obviously the way to the top in the 
defense community is the willingness to move around and accept 
different billets. Overseas, when we have looked at personnel 
systems, for example, in the United Kingdom, they have a 
program called Fast Stream where the way to move up and one of 
the keys to an individual's success is their willingness and 
ability to be successful in a variety of different positions, 
some of them direct service delivery, some of them policy 
shops, some of them administration. That is both how you tap 
into the best talent, that is how you develop the best talent, 
and that is also how you make sure that you have----
    Senator Voinovich. In other words, when they come into the 
agency they know they can be transferred, and that would be 
part of their career plan. They should understand that is what 
could happen to them?
    Mr. Mihm. Yes, sir, and especially if you aspire to the 
highest levels of leadership. In the case of the U.K., it is an 
absolute requirement. It was also at least implicitly one of 
the thoughts behind the creation of the Senior Executive 
Service here in the Executive Branch--that there would be 
movement across agencies. Of course, for a variety of reasons, 
that hasn't played out, but the philosophy is still the same, 
that we have a tendency here to assume that the only people 
that can run things or contribute to a certain organization are 
those that grew up within that organization. Our friends in the 
Partnership for Public Service have talked often about the need 
to bring in talent from the outside, but equally important in 
our view is the need to be able to circulate talent around, to 
realize that there are certain change management, management 
competencies that really do work in a variety of different 
settings, and we need to be able to have the capacity to 
leverage those.
    Senator Voinovich. Thank you.
    Mr. Bullock, Congressman Frank Wolf, are you familiar with 
the personnel-related reforms that have been put in the House 
Subcommittee on Commerce, Justice, State, Judiciary and Related 
Agencies, of the Appropriations Committee?
    Mr. Bullock. Yes, I am, sir.
    Senator Voinovich. Most of those authorities exist in 
current law or regulation. In addition, immediately following 
September 11, the Office of Personnel Management granted the 
Justice Department the authority to re-employ retirees, and I 
am going to ask you a series of questions. Did the FBI utilize 
this authority? Is the FBI using the existing authority for 
retention and relocation bonuses? Has the FBI ever requested 
critical pay authority from OPM? Is the Bureau using category 
ranking for hiring, a flexibility that Senator Akaka and I 
added to the Homeland Security Legislation?
    The point I am making is that there are flexibilities that 
we authorized in the Homeland Security legislation that we 
expected agencies to use. I am interested in knowing are you 
using them and what additional flexibilities do you believe 
that you will need in order to get the job done?
    Mr. Bullock. Yes, we are using some of these flexibilities 
with relocation bonuses, retention bonuses, and so forth. We 
have used them where appropriate. We have brought individuals 
back on the roles as retired annuitants and so forth and 
received the appropriate authorization to do that.
    Senator Voinovich. So you have re-employed retirees?
    Mr. Bullock. Oh, absolutely, sir. Where we fall short is in 
our ability to create the career track that we want to create 
for our intelligence analysts. Under our current performance 
standards, the OPM performance standards, we can only with our 
analysts go up to a GS-14. If you go to a GS-15, you have to be 
a supervisor. We would like to have the ability to go to the 
equivalent of a SES for our analysts and reward them for 
additional expertise and demonstrated ability in doing 
analytical work as opposed to having to become a manager.
    Senator Voinovich. The Bureau does not have the flexibility 
to create non-supervisory SES and GS-15 positions for 
intelligence personnel, and you would like to have that 
authority?
    Mr. Bullock. We certainly would.
    Senator Voinovich. Thank you. If there are any other 
flexibilities that you would need, I would really be interested 
to have that.
    Mr. Bullock. OK. I could get a comprehensive list for you. 
I know the others that you are aware of, the locality pay, the 
ability to have locality pay in certain cities. They are 
looking at that from a governmentwide perspective, but I can 
get a comprehensive list to you if that would be preferable.
    Senator Voinovich. Thank you. We are working on this right 
now and would love to have that.
    Senator Pryor.
    Senator Pryor. Thank you, Mr. Chairman.
    Mr. Turnicky, let me ask you something about your 
repository that you mentioned. Tell me a little bit more about 
that.
    Mr. Turnicky. The data base?
    Senator Pryor. Yes.
    Mr. Turnicky. We began back in 1998, 1999 to create a data 
base that would have in that everyone within the Intelligence 
Community who possesses a top secret SCI clearance.
    Senator Pryor. OK. Hold on. Stop right there. So does that 
mean that when you are doing a background check, does that help 
you do the security check, background check?
    Mr. Turnicky. What that helps me do, sir, is that if I am 
going to be receiving people into CIA, for example, from NSA, 
as opposed to having to send paper or make phone calls or do 
whatever, there are people at NSA, there are people at CIA and 
throughout the Intelligence Community who can check that data 
base to make sure that people have the appropriate clearances 
to come to a given meeting or to see a specific document, 
whatever it may be.
    Senator Pryor. Let me stop right there, because we just had 
a couple of 9/11 commissioners, and I think one or both of them 
said that they had to go through a security clearance with a 
number of different agencies and it was cumbersome and slow and 
all this. Are you saying that you already have something in 
place that would take care of that, for lack of a better term, 
kind of a one-stop shopping?
    Mr. Turnicky. It is close to a one-stop shop for the 
Intelligence Community right now, and I think what the 
commissioners may also have been referring to is the fact that 
if an individual is cleared, say, by NRO and they are coming 
into NSA, that their clearance needs to be within a 5-year 
scope, the background investigation and if a polygraph is 
required. As long as it meets those requirements, then it can 
be transferred over.
    Senator Pryor. OK. Now, is your data base open to all 
intelligence agencies?
    Mr. Turnicky. It is open to personnel, some personnel, not 
to everyone, again because it is classified data base, but 
there are people at the various agencies and throughout the 
Intelligence Community that would have access to that data 
base.
    Senator Pryor. All right. Well, I guess what I am trying to 
figure out is, we have a 9/11 Commission recommendation that we 
pretty much put all the background checks, all the security 
clearances, in one central location. Is it fair to say that you 
have the central location already developed?
    Mr. Turnicky. I would say it is fair to say that for the 
Intelligence Community, but when you go governmentwide, that is 
not there yet. The military DOD has JPAS.
    Senator Pryor. Well, OK, but I think what we are talking 
about today is pretty much limited to the Intelligence 
Community.
    And if this Congress, if we decided that this new function, 
this more centralized function, should be at the National 
Intelligence Director's office, is your data base, is your 
system transferable over to the NID?
    Mr. Turnicky. We would be very flexible.
    Senator Pryor. Well, that is good to know. What are your 
thoughts on that subject, on whether we should have one 
centralized place to do security clearances? Does that make 
sense to you?
    Mr. Turnicky. I think, speaking again from the Intelligence 
Community perspective only, is what we really require is the 
ability to be agile, the ability to be flexible, and to have 
the ability to prioritize. These are critical elements 
throughout the Intelligence Community. The numbers of 
clearances that we in the Intelligence Community deal with 
compared to governmentwide are minuscule. So right now, I 
believe we have that flexibility, and whatever we come up with 
here, from the Intelligence Community's perspective, I would 
just like to make sure that we maintain that ability to be 
agile, to be flexible, and to prioritize.
    Senator Pryor. How long does it take you to do a security 
clearance on average?
    Mr. Turnicky. It depends on the type of clearance. On an 
applicant coming into the agency, the security aspect of it 
will take anywhere from, on average, between 90 and 105 days. 
On an industrial clearance, it is going to take a little bit 
longer. The priorities as they are right now are applicants 
followed by the industrial.
    Senator Pryor. Well, let me ask this: We talked about this 
with the previous panel. When a new administration comes in and 
they are putting their national security team together there in 
the White House, do you prioritize those and try to get those 
turned around?
    Mr. Turnicky. For the most part, we in the Intelligence 
Community would not be doing the background investigations on 
those people. That would be the Bureau.
    Mr. Bullock. That would be the FBI.
    Senator Pryor. OK. And, Mr. Bullock, how long does it take 
you to do those background checks?
    Mr. Bullock. Those background checks are typically done 
within 30 days, and understand that we have a unit in my 
division that would coordinate those assignments, and then 
those leaders are sent out to agents across the field to 
promptly conduct those investigations.
    Senator Pryor. OK. Mr. Mihm, you have made a 
recommendation, as I understand it, that the National 
Intelligence Director should appoint a Chief Operating Officer; 
is that what you called it?
    Mr. Mihm. Yes, sir.
    Senator Pryor. And what would those functions be?
    Mr. Mihm. It would be basically to help the NID deal with a 
series of large scale functional management (personnel, 
information technology, financial management, etc.) as well as 
some of the transformation issues. Typically what we often see, 
and it is not surprising, political appointees come to town 
with agendas and experiences and backgrounds in policy and 
programs. They don't often have as well rounded backgrounds and 
they don't get as thorough an examination on their management 
capabilities. That coupled with the long-term changes that are 
needed in many agencies in the Intelligence Community generally 
lead us to think that a Chief Operating Officer or some similar 
vehicle could help sustain change over time.
    Senator Pryor. Would that be a career position? In other 
words, would that continue from administration to 
administration?
    Mr. Mihm. There are any number of options, sir. For 
example, it could be a term appointment. This model is used 
very often in other countries where it is a term appointment 
with a strict performance contract. If the goals in the 
contract are met, the performance reward is provided. If the 
goals in the contract are not met, the euphemism is they are 
urged to achieve excellence elsewhere. Since we are dealing 
with functional management, you can hold people accountable. 
Let us get a good personnel system in place. Let us get a good 
financial management, IT system in place.
    Really having some day-to-day thinking about the internal 
management of the organization is what is needed, freeing up 
the top leadership to think of the policy and the programs.
    Senator Pryor. OK. Thank you, Mr. Chairman.
    Senator Voinovich. Senator Coleman.
    Senator Coleman. Thank you, Mr. Chairman.
    I want to follow up with Senator Pryor's comment about the 
Chief Operating Officer, COO. Is this something that needs 
congressional action or is this something that the President 
can do by executive order?
    Mr. Mihm. There is any number of models. The President 
could do a version of this certainly by executive order. The 
term appointment would probably require some congressional 
action. But if Congress doesn't want to go that far yet, you 
could certainly urge the NID to appoint a very senior person 
that would have the responsibility for integrating functional 
management, elevating attention to these, and leading the 
transformation, that would help as well.
    Senator Coleman. And I turn to Mr. Bullock and Mr. 
Turnicky. From the Agency's perspective, the FBI's perspective, 
is there anything like this in place now, and how would you 
react to that recommendation?
    Mr. Turnicky. At this point, I would not be aware of what 
is in place at the agency on that, sir.
    Mr. Bullock. No, we don't have a similar position in the 
FBI at that point.
    Senator Coleman. Any reaction to the recommendations? I am 
not holding you responsible for making policy, but as folks in 
the field who are going to deal with a lot of stuff.
    Mr. Bullock. The concern I would have is seeing how that 
would actually work when you have resources from different 
departments and different agencies and others in the department 
with at least partial responsibility that would be redundant 
with this position. How would it actually work, and would we 
ultimately result in just a greater level of bureaucracy if we 
were to put this in place? So I think it would have to be 
analyzed and structured properly to avoid that.
    Senator Coleman. And I think that is always a concern, are 
we making changes in a way that increase efficiency and 
capacity or are we creating more bureaucracy? So I think 
clearly that is the issue.
    We have talked a lot about talent and the need to, like Mr. 
Mihm, you said, circulate talent. Is there enough talent to go 
around, Mr. Turnicky? Are there enough folks out there with the 
language skills, the educational skills, the international 
relation skills to meet the needs of this expanded focus we are 
having on intelligence?
    Mr. Turnicky. My function, again, is in the security end of 
it, and I can tell you from the numbers of applicants and 
contractors who are coming in, there are certainly plenty of 
people out there that we are processing. I think there is 
always--just speaking from the security perspective, there is a 
shortage, I think, governmentwide of investigators. There is a 
shortage of people who are qualified in the adjudicative realm, 
and we are working towards training programs community-wide to 
train adjudicators so that they are all using common standards 
throughout the entire IC.
    But this is something we are dealing with not only as the 
IC. I think that is governmentwide, the shortage of 
investigators.
    Senator Coleman. Mr. Bullock.
    Mr. Bullock. I think as far as the people with the right 
skills, with our agent position, we hire with the critical 
skill and diversity. We have been able to meet our objective in 
both getting enough critical skills and diversity this year. 
With the intelligence analysts, we have had approximately 
57,000 applicants apply since February of this year for our 
intelligence analyst position. Again, applicants and having the 
right applicants are two different things, and we are still 
sorting through those, but it looks like by the end of October, 
we will have on board approximately 800 intelligence analysts 
after filtering through those 57,000 applicants and 
approximately 1,200 agents with the critical skills in most 
areas.
    Where we are having the most difficulty is hiring the 
agents with the language skills, barring Spanish. Arabic, Urdu, 
Russian, Chinese, we still have difficulties finding the 
individuals with those skills that can get through our process 
and overcome the security issues with having family members 
that live abroad and so forth. That is an obstacle that is 
difficult to get around.
    Senator Coleman. Mr. Mihm, do you want to respond?
    Mr. Mihm. Senator Coleman, I take Mark's point that 
certainly for some specialized competencies, there are in a 
sense absolute shortages; however, fundamentally, the issue is 
making sure that we in the Federal Government have hiring and 
recruiting processes that are agile enough to identify and 
bring on the people that are out there. Commissioner Gorelick 
spoke earlier about how the traditional model focused on having 
people with the law enforcement background. It is a whole 
different type of recruiting and hiring model when you are 
going for the diversity of talent that we now need in the 
Federal Government.
    Senator Coleman. It may also be worth having a conversation 
with other educational institutions in terms of what is being 
taught so as to meet the need.
    Mr. Mihm. Yes.
    Senator Coleman. Let me have one, in the time I have, Mr. 
Bullock, just one specific question for you. After the 
Commission issued the report, the FBI agreed, I think with all 
the Commission's recommendations about the operation save one--
I am not sure whether Mr. Fielding or Ms. Gorelick mentioned 
it, but it had to do with an individual at each field office; 
you have an official at the field office, a deputy level for 
national security matters. ``Each field office should have an 
official at field office of deputy level for national security 
matters. This individual would have management oversight and 
ensure that the national priorities are carried out.''
    I believe the FBI response to the recommendation was they 
promised to look at that closely.
    Mr. Bullock. Yes.
    Senator Coleman. Can you tell us where you are on that?
    Mr. Bullock. We initially were to assign an Assistant 
Special Agent in Charge in each office to address national 
security matters. We would step back to look at that and to 
figure out how you could effectively control the scope of 
responsibility, because most of our effort is now in the 
national security arena, and inculcate the intelligence 
responsibility in that as well. So we are currently still 
reviewing to see how we can assign these responsibilities at 
the second level of command in each field office to deal with 
intelligence and national security matters and the criminal 
matters and the cyber matters.
    Senator Coleman. That is very helpful. Thank you.
    Thank you, Mr. Chairman.
    Senator Voinovich. I would like to thank everyone for your 
testimony. A big issue is the decision of where to put the 
Director of Intelligence, in the White House or outside of it, 
and then the other issue is whether or not that individual 
should have a fixed term.
    Mr. Mihm, you talked about the CFO, someone that would have 
a contract and would be there in these agencies. I would like 
your opinion on whether or not you think that individual that 
would be the National Intelligence Director should have a term 
that would carry into the next administration with some ability 
that after 2 years, if there was a difference of opinion, that 
they could be eliminated or ask to leave. A bad word. What is 
your opinion on that?
    Mr. Mihm. Mr. Chairman, as you know, the Controller General 
couldn't be here today. I know he has some views on that, and 
so I would like to be able to confer with him and give you his 
considered position rather than offer something from myself, 
because that really does get beyond my portfolio.
    Senator Voinovich. OK. So at this stage, you would rather 
not----
    Mr. Mihm. I just need to----
    Senator Voinovich. Let us put it in juxtaposition with the 
CFO. You are talking about having a CFO that would have a 
contract. So that CFO, say if you went that route, would be 
there in the department with the intelligence director.
    Mr. Mihm. Right.
    Senator Voinovich. And if that individual would be there, 
and that individual was termed out when the new President came 
in, you would still have the CFO. That is the purpose of your 
concept of the CFO?
    Mr. Mihm. The chief operating officer. What has often been 
added, is that, well, what happens if the new leadership, 
political leadership team just can't get along with this 
individual or this individual can't get along with the new 
leadership team. If we are successful in getting the right 
people to be COOs, these are the types of people who will have 
options elsewhere and they will quickly see. If they are not 
going to be able to integrate with the new political 
leadership, then they will see the need to move on.
    The idea here is just to provide some sort of mechanism 
where we can have continuity and someone on a day-to-day basis 
to worry about what are we going to look like as an 
organization 5, 6, or 7 years out. It is just unrealistic to 
expect that sort of time horizon consistently from political 
leadership.
    Senator Voinovich. At the FBI now, the director is limited 
to 10 years, but there is no other limit at all in terms of the 
director who serves at the pleasure of the attorney general.
    Mr. Bullock. At the pleasure of the attorney general. So, 
yes, we do operate under that system, and I think beyond that, 
as Mr. Mihm stated, we do need the consistently at the CFO, COO 
level. Beyond that, I would like too defer to the director to 
decide on the--to provide his input on where the position 
should be.
    Senator Voinovich. Right. In the case of Mr. Tenet, he 
worked for President Clinton and President Bush, continued his 
service, but he had no term. That was at the pleasure of the 
President.
    Mr. Bullock. Right. Correct.
    Senator Voinovich. It does show that if you get someone who 
is competent, a succeeding President many times retained them 
because they are top-notch people.
    Mr. Bullock. Absolutely.
    Senator Voinovich. Senator Coleman, do you have anything 
further?
    Senator Coleman. Nothing further, Mr. Chairman. Thank you.
    Senator Voinovich. Thanks very much again for your 
testimony.
    Our next panel is composed of Dr. Paul Light, who is a 
senior fellow at The Brookings Institution and Professor of 
Public Policy at New York University. C. Morgan Kinghorn is the 
President of the National Academy of Public Administration. Max 
Stier is the President and Chief Executive Officer of the 
Partnership for Public Service. And, finally, Doug Wagoner is 
the Chairman of the Security Clearances Task Group of the 
Information Technology Association of America.
    And Mr. Wagoner, when you get to your testimony, in the 
first minute of your testimony, would you explain the mission 
of your organization?
    Mr. Wagoner. Yes, sir. I do in my oral testimony.
    Senator Voinovich. OK. Thank you.
    Dr. Light, you have been with us before, and we appreciate 
your presence.
    Mr. Kinghorn, your predecessor worked very closely with us 
in the beginning when we were drafting our human capital 
reforms.
    Max Stier is the head of an organization, the Partnership 
for Public Service, that has been doing an outstanding job of 
reaching out to try and get the best and brightest people to 
come to work for the Federal Government.
    So we are very happy to have you here today, and I would 
ask you in your testimony, to comment on anything that you 
heard from the other witnesses that you agree or disagree with, 
I would appreciate hearing from you about it.
    Dr. Light, we will start with you.

   TESTIMONY OF PAUL C. LIGHT,\1\ PH.D., SENIOR FELLOW, THE 
                     BROOKINGS INSTITUTION

    Mr. Light. It is a pleasure to be here. It is kind of like, 
as Yogi Barra said, deja vu all over again. We have been here 
repeatedly over the years talking about the management and 
organizational problems at different departments, different 
mistakes, events that prompted a flirtation with management 
reform. It is sad to note that the 9/11 Commission had to 
devote so much time in its report to our general difficulties 
getting persistent and deep reform through the Federal 
Government.
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    \1\ The prepared statement of Mr. Light appears in the Appendix on 
page 00.
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    And I applaud this Subcommittee's work on this issue over 
the years. This Committee as a whole has struggled to change 
the management and organizational culture in the Federal 
Government. We have got a real chance here to do some important 
work, and I encourage this Subcommittee to be bold in attaching 
to this legislation broader reforms that you believe are 
necessary. This is a freight train that is leaving the station, 
and sometimes you have to put governmentwide reform on what you 
believe is essential, and I believe this is an opportunity to 
do so as this Subcommittee has been successful in the past.
    I am going to reserve most of my comments today for the 
Presidential appointments process, which is just a disaster. It 
makes absolutely no sense for us to create a new intelligence 
directorate with six to twelve new Presidential Senate-
confirmed appointees if they have to wait 8, 10 to 12 months to 
get on the job, which is a persistent problem in the Federal 
Government more generally.
    On September 11, less than half of the 166 jobs that would 
be engaged in the War on Terrorism were filled with a sworn 
Presidential appointee. That is a remarkable statistic. Two 
months before September 11, the number hovered around a third. 
You cannot direct a government to perform in response to threat 
if the people aren't there. I have characterized this 
facetiously too often as not a problem of headless government. 
We had our secretaries. We had our deputy secretaries in place. 
What we didn't have were the undersecretaries, the associate 
undersecretaries, the assistant secretaries, the long list of 
titles that were open for occupancy at the top of the Federal 
Government and that transfer the directions down to the agency 
front lines and that transfer the knowledge and information 
back up.
    We had what I call neckless government, and we had it for a 
good long time. On average, the Bush Administration appointee 
was in office 8\1/2\ months after inauguration. That is an 
impossibly difficult figure. It is not the kind of appointments 
process that speaks to an agile government. I worked on this 
issue at the National Academy of Public Administration in 1984. 
We pounded the shoe on the table about a 4\1/2\ month average. 
We would give our eyeteeth for that average today.
    I strongly encourage this Subcommittee to pursue the 
Presidential Appointment Improvement Act, which the Chairman 
has introduced which sits before the Committee. I strongly 
encourage you to pursue meaningful reform and Senate rules 
regarding the appointments process. We have got to eliminate 
the use of holds as a device for making political points. I 
understand that this occurs in both political parties. I 
understand the dynamics underneath it, but we have got to take 
action to assure that the Senate and the White House meet their 
obligations to fill positions promptly.
    I also believe that we have to seek a compact with the 
Executive Branch to assure that appointments are handled in a 
timely fashion. I mean, the process does not end with the 
dumping of a nominee's package at the Senate door. Too often, 
past administrations believed that was all their obligation 
requires and then it is up to the Senate to discharge its 
responsibility and wouldn't it be nice if we didn't have all 
these positions subject to Senate confirmation. Well, I am an 
Article One person. I believe that the Senate has an obligation 
to review Presidential appointees, has an obligation to inspect 
the records of Presidential appointees. that is part of your 
constitutional obligation.
    I do not agree with the 9/11 Commission's broad 
recommendation that all positions under Executive Level Three 
should be exempt from Senate review. That would mean that this 
Committee would no longer have the right or responsibility to 
look at Inspectors General, for example, to look at Assistant 
Secretaries, for example, to look at Administrators and to look 
at General Counsels, CFO, Chief Information Officers. You have 
an obligation to look at positions that matter to this country 
and to the government's performance.
    So I argue in my testimony here that you should take a look 
at each of the positions that could be exempted from Senate 
review on a case-by-case basis and develop a reasonable 
inventory of positions that could be dropped from the ordinary 
review process. I also recommend that you undertake a 
streamlining of the Presidential appointments process and 
reduce the number of appointees subject not just to 
confirmation, but actually put in place. We have too many 
appointees. We have got too many layers of needless management 
at the top of government. Again, it makes no sense to create a 
national intelligence directorate if we are just adding new 
layers to the Federal bureaucracy.
    I applaud this Committee and Subcommittee's work. I 
encourage you to be aggressive in your legislating, and I stand 
ready to help you in any way that I can.
    Senator Voinovich. Thank you very much. Mr. Kinghorn.

TESTIMONY OF C. MORGAN KINGHORN,\1\ PRESIDENT, NATIONAL ACADEMY 
                    OF PUBLIC ADMINISTRATION

    Mr. Kinghorn. Thank you, Mr. Chairman, Senator Carper, and 
Senator Coleman.
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    \1\ The prepared statement of Mr. Kinghorn appears in the Appendix 
on page 00.
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    As President of the National Academy of Public 
Administration, an independent non-partisan organization 
chartered by the Congress to give trusted advice to public 
leaders, I really am pleased to be here to provide you with my 
perspective on the recommendations for Federal personnel 
reforming coming out of the 9/11 Commission. The views 
presented today are my own and are not necessarily those of the 
Academy as an institution.
    The 9/11 Commission, as we heard this morning highlighted 
several areas for personnel reform. I would like to focus my 
comments on the issues of providing some additional 
flexibilities to the FBI in its personnel practices. However, I 
will also address certain other related 9/11 Commission 
recommendations, and my testimony is organized around proposals 
affecting the FBI, which were considered by a group convened by 
the Academy in May of this year at the request of Congressman 
Wolf, Chairman of the House Appropriations Subcommittee on 
Commerce, Justice, and State.
    Together, the group examined six proposals. Two of the six 
are consistent with the 9/11 Commission recommendations. Four 
were included in whole or in part in the Appropriation Bill 
passed by the House on July 8. Two proposals would affect the 
FBI, but also have implications for other Federal agencies in 
general and should be considered probably in a broader context. 
I want to offer some brief comments on each of the proposals.
    The first is the establishment of an intelligence career 
service at the FBI. This proposal would create intelligence 
career service, including SES and other senior level positions 
that may be beyond those permissible under the FBI's current 
Title 5 authorities. Unlike the CIA and other intelligence 
services that we heard this morning, the FBI does not have 
authority to create non-supervisory SES and GS-15 positions for 
intelligence personnel. This does limit their ability to offer 
competitive pay and career advancement. The creation of these 
positions would address the FBI's disadvantage when competing 
for talent to staff its intelligence function.
    Although the House appropriations bill did not address the 
career intelligence service per se, and we believe it should be 
addressed, it did authorize the FBI to pay critical 
intelligence positions up to an executive schedule one as a 
first start.
    Second was creating an intelligence decision unit within 
the FBI's budget. The current FBI budget does not have an 
intelligence decision unit. The proposed budget structure has a 
separate decision unit for intelligence, which we proposed. 
Such a budget decision unit would propose a clear review of 
funding devoted to intelligence and prevent those funds from 
being reallocated for other purposes without congressional 
notification. The proposal to create an intelligence decision 
unit within the FBI's budget was included in the House 
appropriations bill. Proposed legislation would collapse the 
ten budget units used in previous years to four decision units 
commented by the 9/11 Commission: Intelligence, 
counterterrorism, counterintelligence, criminal and criminal 
justice services.
    The next proposal was to waive the mandatory retirement age 
beyond 60. The director's current authority to waive the 
mandatory retirement age at 57 is currently limited to age 60. 
Mandatory retirement really is intended to promote a work force 
consistent with the physical demands of law enforcement; 
however, limiting the director's waiver to 60 denies the FBI 
the continued services of really highly-skilled employees. The 
House appropriations bill based on our analysis, again, would 
extend the authority of the director to waive the mandatory 
retirement age of agents, allowing him to delay mandatory 
retirement on a case-by-case basis up to the age of 65.
    The next item that was included in the bill was 
establishing a reserve program within the FBI. As you all know 
and we all know, in recent years, the FBI has faced a variety 
of demanding situations that have stretched the organization's 
personnel capacities. To better enable it to react quickly and 
effectively to future crises, the FBI proposed creating a 
reserve program. This program would allow the FBI to draw 
quickly on a cadre of retired staff who are ready and able to 
provide assistance. It would provide a streamlined process 
thereby to tap a large group of retired staff with the targeted 
skills to accomplish the agency's work on a temporary basis. 
The precedent exists for such programs in the military and 
other organizations and waivers are available for dual 
compensation.
    The House appropriations bill would authorize the director 
to provide for the establishment and training of the FBI 
reserve service that we believe would facilitate streamlined 
temporary rehiring from a pre-certified cadre of retired FBI 
employees.
    Finally, the Academy's role in facilitating the review of 
these proposals complemented our current and ongoing work on 
the FBI's transformation, performed by a panel chaired by the 
former Attorney General and NAPA fellow, Dick Thornburg. It has 
two major components. First, the panel is reviewing the FBI's 
efforts to structure its counterterrorism security and 
intelligence components and to implement the programs it has 
designed in each of these areas; and, second, the panel has 
examined the FBI's field structure with a goal of developing 
criteria that might be used to develop possible alternatives in 
light of the changes in the FBI's strategic focus. We will 
report out on this earlier next year.
    In closing, I wish to emphasize that the Academy would be 
pleased to assist the Subcommittee in its ongoing deliberations 
regarding human capital recommendations of the 9/11 Commission. 
We have significant experience in a variety of agencies and 
organizations, both at the strategic level in terms of 
assessing where agencies should be going, as well as the very 
practical ``on the ground, how do you implement it'' issues 
that are really the expertise of our 550 fellows.
    This concludes my statement, Mr. Chairman. I would be 
pleased to respond to any questions.
    Senator Voinovich. Thank you very much. Mr. Wagoner.

   TESTIMONY OF DOUG WAGONER,\1\ CHAIRMAN, ITAA INTELLIGENCE/
                 SECURITY CLEARANCES TASK GROUP

    Mr. Wagoner. Mr. Chairman, Members of Subcommittee, thank 
you for inviting the Information Technology Association of 
America to testify on current challenges industry faces in 
obtaining security clearances in support of the 9/11 
Commission's recommendations. The hearing is a positive step 
forward in dealing with challenges that have plagued this 
process for decades, a process that threatens national security 
by failing to fill critical positions timely and keeps 
qualified people from working in quality jobs.
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    \1\ The prepared statement of Mr. Wagoner with an attachment 
appears in the Appendix on page 00.
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    My name is Doug Wagoner, and I serve as a Chairman of the 
ITAA Intelligence Committee. I am also vice president of a 
small IT services company, and bring the perspective of small 
business to this issue.
    ITAA is one of the Nation's leading and oldest trade 
associations focused on the IT industry, providing public 
policy and national leadership to promote its growth. Our 
members range from very large companies such as Lockheed Martin 
down to very small companies such as me.
    I have included in my full written statement a copy of a 
detailed white paper that ITAA and seven other industry 
associations have prepared after about 2 years of study that 
provides five recommendations on how to improve this vastly 
complicated process without sacrificing security. While the 
pressures placed on an already stretched system have been 
exacerbated by our government's response to 9/11, the 
challenges we face have been the same for decades. Since 1981, 
if not earlier, GAO has reported every couple of years our 
government's inability to quickly and thoroughly clear----
    Senator Voinovich. Mr. Wagoner, I know we are limiting it 
to 5 minutes, but you can slow down.
    Mr. Wagoner. OK. Sure.
    GAO has estimated the annual cost to government and the 
industry in the billions of dollars, and more worrisome is that 
GAO and others have pointed to direct risks to national 
security on critical projects due to a limited pool of cleared 
people. Since 1981, the affected agencies involved have 
proposed very few changes and have not been held accountable 
for their lack of performance. Results of a recent ITAA survey 
of our membership shows that industry has seen greater than a 
12-month average time period for a new top secret clearance to 
be granted with almost 70 percent saying that it takes over 9 
months. This average is for a clean case where the individual 
has no problems with foreign travel, credit, criminal, or drug 
history. Clearances requiring more extensive investigation, 
such as polygraph, are taking 16 months or more.
    Senator Voinovich. Just so I am clear, these are entities 
the government contracts with? You have people working for you 
on classified projects, and before they can work, you have to 
get a government clearance?
    Mr. Wagoner. Yes, sir.
    Senator Voinovich. And you are saying it is 9 to 12 months?
    Mr. Wagoner. Exactly.
    Senator Voinovich. OK.
    Mr. Wagoner. And this is for a brand new top secret 
clearance.
    Nearly 22 percent of our respondents told us that their 
companies have more than 500 open positions that require 
clearance, and 70 percent said that they have seen a 
significant increase in demand for cleared personnel from the 
government over the past 5 years.
    The 9/11 Commission has made among its recommendations to 
reform the Intelligence Community several suggestions dealing 
specifically with the security clearance problem. Today, I 
would like to focus on four main points of our recommended 
improvements, many of which mirror those of the Commission. 
None of our recommendations water down the investigative 
requirements or processes. Industry believes that we must 
remain diligent to ensure that only those with a need to know 
are granted the access to learn.
    First, we recommend that agencies work through the 
procurement process to authorize what we are calling bench 
strength of cleared personnel. For example, if a contract 
requires 20 cleared positions, we recommend that the 
procurement official authorize 25 cleared positions so that 
industry can quickly back-fill with a new person on that 
contract. This will ensure critical programs to stay on 
schedule and do not get bogged down due to clearance shortages.
    Investigation standardization is an enormous issue for 
industry. ITAA has identified more than 20 agencies with 
distinct clearances across the Federal Government that require 
unique items of inquiry for clearances at particular agencies. 
Despite regulations and executive orders that spell out uniform 
requirements, there is currently no mechanism to enforce such 
standards. The Industrial Security Oversight Office has done 
tremendous work in outlining standards all agencies should 
follow, but they do not have the enforcement capability to 
ensure compliance.
    We agree with the Commission's recommendation to 
standardize investigations and feel this must be addressed in 
more detail in legislation. If there are to be new standards, 
there must be a new mechanism to keep agencies accountable to 
that standard. We applaud the Commission's call to consolidate 
responsibility for clearances into a single entity, but we 
believe that the role should be to coordinate and enforce 
standard policies and programs across government rather than 
actually conducting all the investigations for government.
    We have concerns about the ability of a single organization 
to handle the overwhelming volume of clearance investigations 
that take place each year. OPM's experience has shown that 
trying to absorb other agency's investigatory responsibilities 
only increases delays. Furthermore, OPM does not have the 
culture of meeting the demands of national security, and we 
know the cultural shifts in large organizations will not occur 
in time to meet our country's needs.
    ITAA proposes that a new security clearance czar be 
appointed with the National Security Council to both direct the 
development of and enforcement of uniform standards, that 
actual investigations continue to be carried out by agencies 
requiring clearances. Having a single entity accountable will 
help drive performance in a distributive process using the same 
criteria and can hold agencies accountable.
    On the issue of reciprocity, it would seem logical, Mr. 
Chairman, that when one Federal agency grants a top secret 
clearance, that clearance should be honored by any other 
government agency to work at the same security level. More 
often than not, this is not happening because of unique 
requirements or, worse, a not-approved-here mentality. Ending 
the multiple investigations of the same person would lower the 
caseload and approval times. ITAA agrees wholeheartedly with 
recommendation of the 9/11 Commission that the intelligence 
agencies accept each other clearances; however, we recommend 
that this reciprocity, or what is called cross-over, be 
mandated across all Federal agencies for similar clearance 
levels and that the legislation specify that no Federal agency 
will reinvestigate an individual who holds an active clearance 
from another Federal agency.
    Finally, high demand and low supply for cleared people are 
causing an increase in job hopping which is rapidly raising 
labor costs on government programs. Over half of ITAA's survey 
respondents told us that they regularly pay 5 to 25 percent 
more for a cleared employee who performs the same job as a non-
cleared employee. These increased salaries are most often 
passed along to the Federal Government and unnecessarily drive 
up costs.
    ITAA would also recommend that a statutory performance 
metric of 120 days be established in this legislation to 
complete an initial top secret clearance. Ninety-six percent of 
our survey said that they could better serve government and 85 
percent could make the best and brightest people available to 
government under this 120-day metric. Our experts believe that 
with proper management, systems, and motivation put in place, 
this can be accomplished within 2 years.
    Industry values its partnership with government. ITAA hopes 
to work collaboratively to improve the process that is critical 
to national economic and personal security. Thank you for 
invitation, and I would be happy to answer your questions.
    Senator Voinovich. Thank you. Mr. Stier.

   TESTIMONY OF MAX STIER,\1\ PARTNERSHIP FOR PUBLIC SERVICE

    Mr. Stier. Thank you, Mr. Chairman, Senator Coleman, and 
Senator Carper. I very much appreciate the opportunity to 
testify on such a critical subject.
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    \1\ The prepared statement of Mr. Stier appears in the Appendix on 
page 00.
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    I had a little bit of a surprise this weekend. I was 
expecting a baby 16 days from now, but he decided to arrive on 
Saturday.
    Senator Voinovich. Congratulations.
    Mr. Stier. Thank you very much. And I must say that it is 
undoubtedly true that anybody who has a newborn thinks very 
much about the future. For me, the fact that my newborn came on 
September 11 only heightens my concern about what we are doing 
as a Nation to address these problems. I want to think very 
much that we are at a crossroads about how we are addressing a 
very new threat, and the work that you are doing here is to be 
commended because it is so vital.
    I think the Commission said it best when it said that the 
quality of the people is more important than the quality of the 
wiring diagrams. Unfortunately, it is much easier to focus 
attention on wiring diagrams than people issues, primarily 
because the people issues are much harder. They take more time. 
They can't be resolved by a stroke of a pen, and they are 
sometimes issues of judgment and of simply good management. I 
think that many of the reforms that you are proposing or 
considering in the legislation here will go a long ways to 
improving the Federal Government's capacity to respond to this 
threat, and I want to take a step back. In my written 
testimony, I offer some support and information about a variety 
of things that you are doing, but I think it is worthwhile 
taking a step back and thinking more comprehensively about what 
the challenges are that we face.
    I would organize these, looking at the way the government 
addresses talent issues, in three primary ways. The most 
important is that I think the Federal Government today does not 
address people issues as a management issue. They see it 
primarily as a transactional question that Human Resources 
professionals are going to take care of. That is a real 
problem, and if there is one thing that we could do ultimately 
to address the people question, I think that is the thing we 
need to have happen, to have managers and leaders take 
ownership of the talent in their organizations.
    If you look at top private sector companies, the head of GE 
recently said that he spends at least 30 days a year of his 
personal time on trying to get and keep the very best people. 
Tom Tierney, who turned around Bain Consulting, said that he 
spent probably half his time on people issues. That is not 
something that we see very much in the Federal environment. The 
oversight of this Subcommittee, I think is going to be vital to 
ensure that you get leaders in government to pay attention to 
that critical asset.
    I also think that the performance management standards that 
you are considering having the National Intelligence Director 
be responsible for will be important, and I think, very 
importantly, the prospect of perhaps a chief human capital 
officer who would be responsible for talent issues across the 
Intelligence Community instead of under a single agency would 
be very valuable.
    The second area I think that is important to focus on is 
the hiring process itself. Obviously, there has been a lot of 
discussion, particularly of late, of the hiring process, 
concerns that it is too slow and too difficult. That is all 
true and something that we need to address, and I think that 
whether it is security clearance issues or many other concerns 
or, on the political side, the appointments process, those are 
very important reforms.
    It is also true, though, that the hiring process 
comprehends a lot more than just the speed of hiring. For 
example, we will be issuing a report shortly about the 
assessment processes that the Federal Government uses in 
determining who to hire. You need to hire fast, but if you 
don't hire well, it doesn't matter how fast you hire, and that 
is something that the Federal Government needs to focus on 
quite extensively.
    It is also true that we need to see more incentives for the 
Intelligence Community and for the government at large to be 
able to recruit the very best people. I know that, again, you 
are considering a scholarship program, which I think could be 
very important, and also, Senator Voinovich, you have proposed 
governmentwide the GOFEDS legislation which would enhance the 
student loan repayment authority the government has by making 
it nontaxable, which I think would also go a long ways to 
increasing the Federal Government's capacity to both recruit 
and retain top talent.
    The final piece that I would focus on is taking a look at 
the way that government conceives of its own talent. The 
historical model has been always that public service has been a 
career, and while that is a wonderful notion and it is terrific 
to have people who decide to come into government for their 
entire career, the fact of the matter is that the talent pools 
have changed and they no longer see themselves going to a 
single job. They view their likelihood of being in many 
different jobs. In fact, the average now is 3\1/2\ years for 
any particular job.
    We need to see the Federal Government change the way it 
thinks about talent so that it becomes viewed as a career 
builder and not only a career, and that is particularly true 
when you look at the Federal Government's needs for mid-career 
talent. Again, we issued a research report in the last month 
that demonstrates that nearly 15 percent of GS-12 and above 
jobs are being filled externally, and that has significant 
consequences for some of the issues that the 9/11 Commission 
report identified in terms of bringing in the kinds of skills 
and talents that, frankly, you are only going to find if you 
appeal to the whole range of talent markets, both internally 
and externally.
    It is also true that by creating the kinds of training and 
development opportunities, again, that you are looking at in 
this Subcommittee, you are going to be able to not only improve 
your existing talent pool, but also become a more attractive 
employer for those who are perhaps contemplating but not yet 
deciding whether they want to enter into public service.
    So with that, thank you for the opportunity to testify. Of 
course, I am happy to answer questions, and any follow-up that 
we can do at the Partnership for Public Service, we would be 
very pleased to take on. Thank you.
    Senator Voinovich. Thank you. I would like to thank all of 
the witnesses.
    Mr. Light, the Commission has made several recommendations 
in terms of the Presidential appointments process. You 
recommend removing positions below Executive Level Three from 
the confirmation process, which doesn't have very much of a 
chance of getting through this body. At what level would you 
draw that line, or would you give the agencies the opportunity 
to suggest where they don't think they need the approval?
    Mr. Light. I believe that you can come up with a list of 
level four and level five positions that could easily be 
exempted without much agony by the Senate and the White House 
working together. My view is that the Assistant Secretaries for 
Public Affairs, no offense to the profession, that those 
positions may not need Senate confirmation, but an Assistant 
Secretary for Health at HHS or an Inspector General, I think 
those positions are very important and ought to be subject to 
review.
    So I think it is just a function of actually laying the 
positions--there are 500 or so of them--out on the table and 
saying which ones of these can we streamline and which ones do 
we need to subject to hearings. We also need to ask the 
Executive Branch for some ideas on how to reduce the numbers 
wherever possible. I think we have too many of them. The Senate 
has agreed with that in the past, but I think you have to look 
at each position on a case-by-case basis, and it is not such a 
large number that you can't do it in a relatively short time.
    Senator Voinovich. Well, part of the problem always is 
getting agencies to come back and list the positions. We had a 
little task force, a bipartisan group, and the legislation 
failed because certain committees in the U.S. Senate didn't 
want to give up the advise and consent role of certain 
individuals. My thought was that we might have an opportunity 
in creating this new agency. I would be interested in knowing 
from you what criteria you would use in drawing that line in 
terms of confirmation of the Senate.
    What do you think of the recommendation of confirming all 
national security nominees within 30 days of their submission?
    Mr. Light. Well, I think it is a great recommendation. I 
would settle for 45 or 60 days. I mean, you know the challenges 
here, but I think that we ought to--we have been going the 
opposite direction on asking the President to forward nominees. 
So now we allow vacancies to be held by an acting official for 
180 days. So we have upped that over the years, basically 
saying, OK, you we can't get them up here in 6 months; at that 
point we will enforce some sort of penalty. And on the Senate 
side, we have sort of increased the level of delay as well.
    I think we ought to say as a general rule that we want 
these folks to be in office within 120 days of a vacancy. Now, 
how you sort that out, if it is 30 days in the Senate or 60 
days, how you do that between the Executive and the Senate, I 
think you have to establish a benchmark and hold to it, and if 
the position can be vacant for 180 days, don't we have a good 
rationale at that point for abolishing the position because it 
is irrelevant to have it in the first place? I mean, we could 
spur a lot of action if we were to impose on ourselves that 
kind of obligation.
    Senator Voinovich. So you think we should strive for 
looking at some level and then institute a 45-day limit on 
nominations.
    Mr. Light. I think Senator Baker and the other Senators 
that we have talked to over the years in the Presidential 
appointee initiative, their view is 45 days is a pretty 
significant leap. I mean, set it wherever you can and push for 
it and see if you can get some Senate rules changes on the hold 
and see what you can do.
    But I wouldn't restrict it, incidentally, just to national 
security. It seems to me that we ought to set it as a benchmark 
for all positions in the Federal Government.
    Senator Voinovich. With the urgency and the crisis, we 
might be able to at least make a first crack at it.
    Mr. Light. Yes, hopefully.
    Senator Voinovich. As you know, my legislation would 
streamline the financial disclosure form for the Executive 
Branch employees. It also requires that the Office of Personnel 
Management provide a list of all appointed positions to the 
major Presidential candidates 15 days after they receive their 
party's nomination. I think you have already said that you 
think that this legislation would help a great deal.
    Mr. Light. I am absolutely convinced that you should move 
ahead with that particular bill as an attachment. I don't see 
any reason not to push for it at this particular point. The 
National Intelligence Director is going to have to interact 
with political appointees in all departments to do his or her 
job. The Secretary of Treasury, the Secretary of HHS, and so 
forth, I do see the line here to restrict improvements in the 
appointments process just to intelligence positions. I see no 
reason not to attach your legislation to whatever emerges from 
this Subcommittee.
    Senator Voinovich. As you know, we were able to get 
significant human capital reforms attached to Homeland 
Security. We mentioned those to Mr. Bullock today.
    Mr. Light. Correct.
    Senator Voinovich. I am concerned that agencies are not 
using those flexibilities.
    Another issue that has come up in terms of the legislation 
is the issue of the financial disclosure form.
    Mr. Light. Right.
    Senator Voinovich. Several of my colleagues want the 
disclosure form to be changed for all the branches of 
government. My legislation limits it to the disclosure form for 
Executive Branch only. Would you like to comment on that?
    Mr. Light. I share the general and worthy goal of extending 
this to other positions, but it seems to me that the argument 
is being made that everybody should remain in an appointee 
Hades, shall we say, unless everybody gets out. I think we have 
an opportunity here to do something. It is not the perfect 
opportunity. I think we should move ahead and create the 
precedent for action on the Judicial and Legislative Branches 
at that time. I have long believed that particular objection 
was not reasonably given our incremental progress in the past. 
We just have to move forward where we can.
    Senator Voinovich. So that the bill just deals with the 
Executive Branch and, again, would be a forward step. You 
recommend we consider Congressional disclosure separately?
    Mr. Light. I say go, go, go on this. I mean, push it 
forward as you can. It is an opportunity, and with all due 
respect to your colleagues who raised these issues, I think you 
just have to push where you can at this particular moment.
    Senator Voinovich. Thank you.
    Senator Coleman. Thank you, Mr. Chairman. Thanks for your 
work in this area.
    I hope that 9/11 is a wake-up call. We were just going down 
a path, like Mr. Light was saying, from 4 months at one point 
in time to 8\1/2\ months now and just the difficulty level and 
partisanship, political chips being used to put holds on 
things, and, perhaps, the confluence of the events of 9/11 are 
forcing us to say we have to move quicker with the work, Mr. 
Chairman, that you have been doing.
    I was going to ask the question that has been asked about 
should we focus this on intelligence and should we do this 
governmentwide, and I think the response is we take advantage 
of this opportunity to make the system work. So I hope that 
happens. I also just want to note how helpful this hearing has 
been.
    Mr. Light, you have talked a lot about folks on the outside 
who are doing work, and then typically we are thinking about 
within the government process, but in order for government to 
function, we need to work with folks outside the system and 
they have to go through the same processes, and if we don't 
think about that and somehow clarify that, accelerate it, and 
make it work better, we are all in big trouble, and the idea, 
then, of government being not just a career but a career 
builder, which really just reflects the nature of what I give 
in speech after speech, that we don't train people for one job 
anymore, we don't educate them for one job. That is an 
expectation. Well, it should be an expectation in government 
and not just outside government.
    So this has been extraordinarily helpful.
    We didn't talk much about the process of people, keeping 
them in government. Maybe it is because there is an election 
coming up, there is a lot of discussion about who is staying 
and who is leaving. That whole process of can you incentivize 
the process and encourage people to stay on, or is there just 
something about burnout that is kind of a natural process? 
Would anyone like to respond?
    Mr. Kinghorn. Mr. Coleman, I would love to. As you know, I 
worked in the Federal Government for 25 years and then became a 
partner in a consulting firm where I ran a practice of about 
600 consultants and 20 partners and faced the same issues from 
a private sector standpoint. I think you have got to look at 
the retention issues, as Max indicated, and we have done some 
work on it very differently.
    People are not going to stay, as I did, for 25 years in the 
Federal Government, but I moved around a lot at the SES level. 
That was one advantage I had. I think what you ought to do is 
realize they are going to come and go and come back, and I 
think your whole strategy and what is important about this 
Subcommittee's work is you are beginning to look at this issue 
and have looked at the CEO and the human resource issue as a 
strategic management tool.
    For as long as I was in government, human resources was, 
really to me, seen as a business process and not particularly 
well run, but we have used the budget for years, decades, as a 
prioritizing tool. We used organization structure as a 
prioritizing tool. And now you are looking at using the 
strategic nature and the operational nature of human resource 
management as a strategic tool, how do you provide incentives 
for people to move up the food chain in the FBI, and you are 
addressing that.
    So I think that is part of the answer. I don't think it is 
pay. I think pay is improving. I think we have got some ways to 
go. I think it is basically creating an environment where 
people can easily come and go and gain experience. For me to 
come back into government now, someday which I would probably 
love to do, it is going to be very difficult. It is still 
difficult. So I think the old rule of how am I going to keep 
Morgan Kinghorn here for 25 years in the same agency, people 
are realizing that is not the right question. I think your 
question is right, and I think the answer is different 
incentives, different pay mechanisms.
    The Academy doesn't speak uniformly on this issue, but I 
have personally less concern that we have different human 
resources practices and policies, because I think each agency 
is different. I think we have to have the underlying Title 5 
kinds of protections, because this is government, it is public 
service; but if you want to set a priority, I don't see there 
is too much wrong in setting a particular priority in a 
particular program in the human resources arena. I think that 
is what you are trying to deal with now.
    Senator Coleman. Anybody else?
    Mr. Stier. Thank you. And, Senator Coleman, my own view is 
that the retention and recruitment issues are really two sides 
of the same coin. I mean, ultimately who you need, what kind of 
talent you need will depend on who you are able to keep, and so 
that is important, obviously, to be thinking about. I think 
systemically what you are doing on both sides and if you create 
a work environment that is going to be attractive for existing 
employees, that will also be a draw; and likewise, the flip 
side, if you don't, you can sell all you want and sell very 
well, but you are not going to get good people in.
    The Partnership used data that was collected by the Office 
of Personnel Management, a hundred thousand employee survey, 
and put together a ``Best Places to Work'' ranking of Federal 
agencies, 189 subcomponents. Across the board, the No. 1 issue 
that was most important for employees in terms of their own 
engagement in agencies was the quality of their managers and 
leaders, and I would say that if you were to do one thing to 
focus on retention, that would be to develop and train, 
attract, and keep the very best managers.
    And that is typically what you also see in the private 
sector. People generally don't leave jobs. They leave managers, 
and that is something that the Federal Government has truly not 
focused on, hasn't invested in that management capacity, and 
that is something I think would be of enormous benefit and 
consequence.
    Senator Coleman. Very good. Thank you, gentlemen. This has 
been a very helpful and very informative panel.
    Thanks, Mr. Chairman.
    Senator Voinovich. Mr. Kinghorn, you have really studied 
the FBI, you have seen the recommendations of the Commission, 
and you heard the testimony of Mr. Bullock. Do you believe that 
there is additional legislation needed at this time to deal 
with the problems at the FBI?
    Mr. Kinghorn. I think we will know more. I mean, the group 
that the Academy is studying is really under the auspices of 
Governor Thornburg, and some of that report will be completed 
later this fall, and I am sure the governor would love to brief 
the Subcommittee on that.
    From what I know from a personal standpoint, I would concur 
in the recommendations that we worked on with Congressman 
Wolf's effort on the intelligence career service. I think that 
is important. I think your concept, the concept that was raised 
of a Chief Operating Officer, makes sense to me. I was in a 
similar position to that back in EPA years ago when the 
administrative functions, and the management functions, were 
really much less complex. They are now very complex. There 
tended to be some balkanization of management functions in the 
government, the creation of CFOs, the CEOs, CIOs. I think that 
is healthy because it has raised each of those organizations to 
a point of importance organizationally.
    But I think the concept of a CEO is important because 
nearly every administrative function you bring up is a new 
financial system, a new management system, and it is no longer 
tied into just one of those functions. When I brought up two 
financial systems at EPA and IRS, I could have done it myself 
because it was viewed as a very narrow function. We were 
successful. Now procurement is touched. Human Resources is 
touched. Program management information is touched.
    So the concept of a COO, Chief Operating Officer at the 
department level even in bureaus or in this new intelligence 
operation, I think makes sense to tie together short of the 
Secretary, short of the head of the agency, those functions 
because they do not interact particularly well. So that 
concept, I think would be very helpful.
    Senator Voinovich. Mr. Wagoner, do you think that one 
agency conducting security clearance investigations would make 
sense?
    Mr. Wagoner. No, sir, we do not for some of the reasons 
that Mr. Turnicky had mentioned earlier. Each agency has 
slightly higher priorities at any given time. We also believe 
that distributing this across multiple agencies with the right 
management processes, the right systems, and the right 
oversight would make a much better decision, and that is why we 
had recommended putting a national security czar at the 
National Security Council to be able to look across government 
and enforce these standards.
    Senator Voinovich. Well, we have had some people looking at 
that. I just checked how long it took my own two staff members 
to get clearance from the State Department. It was 8 or 9 
months.
    Mr. Wagoner. Yes. It is just not getting any better. We are 
encouraged about looking at--we had not considered having this 
person report to the NID. One of reasons we did not make that 
recommendation was we were concerned about the other 
departments, primarily Defense, what their reaction would be in 
having their clearances being done under the NID. That is the 
only reason we did not make that recommendation.
    Senator Voinovich. Well, if you had somebody working for 
the NID that would be responsible for cracking the whip, 
wouldn't that make sense?
    Mr. Wagoner. Yes, sir.
    Senator Voinovich. What do you think about setting a limit 
in terms of time on some of these things and just forcing 
people to get the job done?
    Mr. Wagoner. That is our primary recommendation, and like I 
said, we had studied this for 2 years on our panel. We had 
folks that actually were in leading government security 
clearance organizations, and again, with the right management 
systems and motivation, it can be done in 120 days, and we 
think it is time to codify that because this has been going on 
since at least 1981 and just a lot of talking, a lot of 
meetings, a lot of studying, but we just haven't seen any 
changes to a process that was really invented in the Eisenhower 
Administration.
    Senator Voinovich. Max, you have been doing some studies 
about what keeps people from coming into the Federal 
Government. One of the reasons why the John F. Kennedy School 
of Government made human capital one of their executive 
sessions is the fact that so many of their people who had 
ordinarily gone into government service decided to pursue other 
opportunities. I would like you to comment on the issue of the 
disclosure forms that one has to go through and the appointment 
process. Also, in the intelligence area, is the long time that 
one must wait before they are cleared impacting our ability to 
attract the best and brightest to the government.
    Mr. Stier. There is no question that all those issues that 
you mentioned are related, and they reinforce a perception that 
many talented Americans have about government, that is from our 
research, the primary barrier for their being interested in 
coming into public service, and that is seeing the government 
as a bureaucracy, a place that they will get lost and a place 
where their creativity and their individuality will not be able 
to express itself and a place in which they themselves are not 
going to be able to make a difference.
    So, fundamentally, I think that what we see is a collection 
of misperceptions and also realities that reinforce that view 
of government, both of which need to be changed. The realities, 
the ones that you have mentioned, disclosure forms, security 
clearance processes that take very long, the appointments 
process that means that leadership is not in place, all of 
those reinforce objectively a view by talented Americans that 
even if government is an interesting place to go, it is not 
worth it because of the bureaucratic tangles they are going to 
have to experience in either getting in or once they arrive.
    So what is interesting about our research is that there, in 
fact, is an enormous reservoir of goodwill towards Federal 
workers. There is an enormous reservoir that cuts across both 
party and ideological lines about the value of public servants, 
but we need to move that into a cohort of talented people that 
also want to be public servants, and the No. 1 perception and 
reality we will have to change is that issue of, for lack of a 
better term, bureaucracy, and that is something that I think 
all the different recommendations that you have heard from this 
panel and that you are examining yourself are going to be very 
important in trying to change.
    So in terms of accessing that external talent pool and, 
likewise, in keeping the talent that you want inside 
government, these kinds of reforms, I think, will make a very 
big difference.
    Senator Voinovich. Thank you very much. I really appreciate 
all of you being here with us. We will see how responsive we 
are to some of your good ideas.
    Thank you very much. The hearing is adjourned.
    [Whereupon, at 12:08 p.m., the Subcommittee was adjourned.]


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